SEBI Revokes Registration of 'Research Analyst' Who Ran Grocery Store Instead

India's securities regulator has cancelled the registration of a supposed research analyst who was actually operating a small grocery store in Madurai, in a case that exposes serious gaps in the oversight of financial advisory services in the country. The Securities and Exchange Board of India (SEBI) took action after discovering that Purooskhan, despite holding a valid research analyst licence, had no involvement in securities markets and instead sold daily essentials from a 100-square-foot provision store.

The revocation followed a hearing where the analyst appeared unfamiliar with basic market operations and explicitly stated he ran a small business rather than providing investment advice. The case originated from complaints about a website—optionresearch.in—that promised unrealistic returns while fraudulently displaying Purooskhan's SEBI registration number to appear legitimate.

Background and Context

India's research analyst regulations require individuals to obtain SEBI registration before offering investment advice, with strict criteria including educational qualifications and experience in financial markets. The system aims to protect retail investors from fraudulent schemes that promise guaranteed returns in volatile markets. However, this case reveals how regulatory mechanisms can be circumvented when registered individuals allow their credentials to be misused or when verification processes fail to detect fundamental irregularities.

The problem of unauthorized investment advice has grown significantly in India, with numerous operators using social media and messaging platforms to offer "sure shot" trading calls. SEBI's SCORES complaint platform has received thousands of such complaints in recent years, but enforcement remains challenging when registered credentials are exploited by third parties.

Key Figures and Entities

According to the SEBI order issued by Santosh Kumar Shukla, the regulator's quasi-judicial authority, Purooskhan claimed his registration details were being misused without his consent. During the hearing, he stated he operates a grocery business and has never provided market research or investment advice. The order noted that Purooskhan had filed complaints with both the Tamil Nadu Police and Cyber Cell regarding alleged online financial fraud.

The website in question, optionresearch.in, offered multiple paid investment advisory packages while prominently displaying Purooskhan's SEBI registration number. The platform attracted at least one investor who paid ₹50,000 for services but subsequently suffered losses of approximately ₹4 lakh. SEBI investigators found that the website claimed to offer zero-risk opportunities and promised investors would double their money—statements that violate advertising regulations for financial services.

Legal and Financial Mechanisms

The investigation revealed that Purooskhan had shared his email ID and password with unknown parties, raising serious questions about credential security among registered financial professionals. He claimed an individual approached him by posing as a bank employee offering a research analyst position, under which pretext his documents were collected and later misused.

After SEBI launched its investigation, the Option Research Company allegedly issued Purooskhan an appointment letter naming him as compliance officer and authorizing him to issue trading calls—an offer he claims to have refused. This sequence of events demonstrates how fraudsters exploit legitimate registrations to lend credibility to illegal schemes while maintaining plausible deniability for the registered individual.

International Implications and Policy Response

While this case unfolded in India, it reflects a global challenge where financial regulators struggle to prevent the misuse of professional credentials in digital environments. Similar issues have emerged in markets worldwide, where unregistered operators either forge credentials or manipulate registered individuals to bypass regulatory safeguards. The case underscores the need for enhanced verification systems and stronger penalties for both those who misuse credentials and those who willingly facilitate such misuse.

Regulatory experts suggest that SEBI may need to implement periodic verification of whether registered individuals are actually engaged in authorized activities, rather than relying solely on initial registration processes. The incident also highlights the importance of investor education regarding the verification of credentials and the unrealistic nature of guaranteed returns in financial markets.

Sources

This report draws on the SEBI order dated December 30, 2025, information from the regulator's SCORES complaint platform, and publicly available details about SEBI's registration requirements for research analysts. Additional context was obtained from previous reporting on unauthorized investment advice schemes in Indian media.