Description

SEBI enquiry order regarding Investment Adviser Manoj Jethanand Varyani recommending disposal without adverse action after investigating alleged regulatory violations.

Summary

SEBI has issued an enquiry order regarding Manoj Jethanand Varyani, Proprietor of Smart Financial (Registration No. INA000015419), following an inspection conducted on August 18, 2023. The Designated Authority has recommended disposal of proceedings without any adverse action despite allegations of regulatory violations.

Key Points

  • Noticee was registered as Investment Adviser under SEBI Registration No. INA000015419 (individual capacity)
  • SEBI inspection covered period from April 01, 2022 to July 31, 2023
  • Allegations included failure to maintain arm’s length distance between investment advisory and other business activities
  • Noticee was functioning as director (70% shareholding) of Bestway Smart Financial Private Limited while holding individual IA registration
  • Served as Principal Officer in both Smart Financial and Bestway Smart Financial Private Limited
  • Show cause notice issued on July 12, 2024 under Intermediaries Regulations

Regulatory Changes

No regulatory changes introduced. This is an individual enquiry order with recommendations for case disposal.

Compliance Requirements

The order emphasizes the importance of Investment Advisers maintaining proper arm’s length distance between different business activities as required under Regulation 15(3) of IA Regulations, 2013.

Important Dates

  • August 18, 2023: SEBI inspection conducted
  • July 12, 2024: Show cause notice issued
  • February 28, 2025: Enquiry Report submitted by Designated Authority
  • August 6, 2025: Order published

Impact Assessment

Minimal market impact as this is an individual case involving a specific Investment Adviser. The recommendation for disposal without adverse action suggests the violations were not deemed severe enough to warrant punitive measures. This serves as a reminder for Investment Advisers to ensure proper segregation of business activities and compliance with regulatory requirements.

Impact Justification

Individual case with no adverse action recommended, limited market impact