The Securities and Exchange Board of India (SEBI) has ordered Avadhut Sathe Trading Academy Private Limited (ASTAPL) and its founder, Avadhut Sathe, to refund ₹546.17 crore collected through activities that the regulator found amounted to unregistered investment advisory and research analyst services. The regulator has also imposed penalties totalling ₹11.5 crore and barred the academy and its founder from accessing the securities market.
In its order dated October 23, 2026, SEBI directed the academy and Sathe to deposit an additional ₹67.87 crore in interest with the regulator’s Investor Protection and Education Fund (IPEF). The action highlights the regulatory scrutiny facing trading academies that offer stock-market education alongside recommendations that may fall under regulated investment services.
The investigation examined the academy’s paid courses, live trading sessions, promotional material and communications with participants through WhatsApp groups.
SEBI imposes ₹11.5 crore penalty
The total penalty of ₹11.5 crore has been divided among the academy and two directors. ASTAPL has been fined ₹6 crore, Avadhut Sathe ₹4 crore and Gouri Avadhut Sathe, another director, ₹1.5 crore.
SEBI has barred the academy and its founder from accessing the securities market for two years or until they comply with the refund direction, whichever is later. Gouri Sathe has been barred from the market for six months.
The academy and its founder have five months from receipt of the order to deposit the refund amount into a designated bank account. They must also publish notices in English and Hindi national newspapers and a widely circulated local-language newspaper within 30 days, explaining how eligible participants can claim refunds.
The regulator has ordered debit restrictions on the bank accounts of the academy and its founder until the required amounts are deposited. They have also been prohibited from selling assets, including shares and mutual fund investments, except where necessary to comply with the refund directions.
Why did SEBI take action?
SEBI’s investigation covered the period from July 1, 2017, to October 9, 2025. The regulator concluded that the academy and its founder went beyond teaching stock-market concepts and provided investment recommendations without the registrations required under securities market regulations.
According to the order, participants received stock-specific buy and sell calls, entry and exit targets, stop-loss levels and forecasts about price movements. These recommendations were allegedly communicated during paid programmes, live sessions and through private messaging groups.
SEBI maintained that describing such activities as educational content did not remove the requirement to register as an investment adviser or research analyst when the services met the relevant regulatory definitions.
The academy and its founder argued that their programmes were educational and that participants made their own trading decisions. They maintained that fees were charged for courses rather than investment advice. SEBI rejected these arguments after examining the evidence.
The regulator said the academy and Sathe had collected approximately ₹601.38 crore from participants since the business began. Of this amount, ₹546.17 crore was identified as attributable to the activities covered by its findings and was ordered to be refunded.
Concerns over promotional claims
SEBI also raised concerns about the way the academy promoted its courses. The regulator found that promotional material highlighted selected profitable trades and claims about participants earning high returns, potentially creating misleading impressions about the likely results of trading.
The order noted that the academy had received an administrative warning in March 2024 concerning misleading representations and selective disclosure of performance. SEBI found that the concerns continued despite the warning.
Stock-market trading carries substantial financial risk, particularly in derivatives and other leveraged products. Beginners may be attracted by success stories and profit claims without fully understanding the possibility of losses.
SEBI’s action underscores the distinction between general financial education and personalised or stock-specific recommendations. Registration requirements are intended to improve accountability, address conflicts of interest and protect people who rely on professional investment guidance.
How will participants claim refunds?
Eligible participants will need to follow the refund procedure that the academy and its founder are required to publish. The notices must explain how claims can be submitted, and the refund process must maintain an auditable record of payments.
Any balance remaining after the refund process will be handled under SEBI’s directions. The regulator has stipulated that funds left over must be retained in an escrow arrangement for one year to allow further distribution to clients, complainants and investors who used the relevant services. Any amount still remaining after that period will be transferred to the IPEF.
Gouri Sathe’s liability was considered separately. SEBI attributed the action against her to a failure to exercise adequate oversight as a director. The regulator did not find that she had personally provided the disputed services, devised the arrangement or received wrongful gains attributable to it.
A warning for trading academies
The case sends a clear message to trading academies, online educators and financial influencers that stock-specific recommendations and promotional claims can attract regulatory scrutiny, even when delivered through courses or digital platforms.
As online trading education expands, investors should assess claims of exceptional returns carefully and verify whether a provider holds the appropriate SEBI registration for the services being offered.
Teaching market fundamentals is different from providing regulated investment advice. SEBI’s order reinforces that the nature of a service, rather than simply the label attached to it, determines the applicable regulatory obligations.
The refund direction, financial penalties and market-access restrictions mark a significant enforcement action in India’s financial education sector. The case also places renewed focus on investor protection and the responsibility of trading academies to communicate risks transparently.