Description

SEBI adjudication order against Research Analyst Prerna Sharma (INH000006819) for alleged violations of RA Regulations, PFUTP Regulations, and Intermediaries Regulations during inspection period April 2021 to March 2023.

Summary

SEBI issued Adjudication Order No. Order/SM/SM/2025-26/31941 under Section 15-I of SEBI Act, 1992 against Prerna Sharma (PAN: BJEPS7547A, SEBI Registration: INH000006819), a registered Research Analyst. The order follows an on-site inspection conducted from March 20-22, 2023 covering the period from April 1, 2021 to March 22, 2023. The proceedings allege multiple violations of SEBI (Research Analyst) Regulations 2014, SEBI (PFUTP) Regulations 2003, and SEBI (Intermediaries) Regulations 2008.

Key Points

  • On-site inspection conducted March 20-22, 2023 for inspection period April 1, 2021 to March 22, 2023
  • Inspection findings communicated April 10, 2023; Noticee replied April 28, 2023
  • Adjudication proceedings initiated under Section 15-I of SEBI Act, 1992
  • Multiple alleged violations across three regulatory frameworks
  • Research Analyst registration number: INH000006819
  • PAN: BJEPS7547A

Regulatory Violations Alleged

Under Section 15EB of SEBI Act:

  • Regulation 13(i) and (iii) of RA Regulations
  • Regulation 19 of RA Regulations
  • Regulation 20 of RA Regulations
  • Regulations 3(a), (b), (c), (d), 4(2)(k)(o), (s)(i) & (s)(iii) read with Regulation 2(1)(b)(ii) and Regulation 2(1)(c)(5) of PFUTP Regulations
  • Regulation 24(2) read with clause 1, clause 7 and clause 8 of Schedule III of RA Regulations
  • Regulation 25 of RA Regulations
  • Regulation 13(1) of Intermediaries Regulations along with Circular No. SEBI/HO/IMD/IMD-II CIS/P/CIR/2021/0685 dated December 13, 2021
  • Regulation 7(iv) of RA Regulations, clause 1 and clause 7 of Code of Conduct under Schedule III of RA Regulations

Under Section 15HA of SEBI Act:

  • Regulations 3(a), (b), (c), (d), 4(2)(k)(o), (s)(i) & (s)(iii) read with Regulation 2(1)(b)(ii) and Regulation 2(1)(c)(5) of PFUTP Regulations
  • Regulation 24(2) read with clause 1, clause 7 and clause 8 of Schedule III of RA Regulations

Under Section 15C of SEBI Act:

  • Regulation 13(1) of Intermediaries Regulations along with Circular No. SEBI/HO/IMD/IMD-II CIS/P/CIR/2021/0685 dated December 13, 2021

Compliance Requirements

  • Research Analysts must comply with Regulation 13 (general obligations and responsibilities)
  • Adherence to Regulations 19 and 20 of RA Regulations required
  • Compliance with Code of Conduct under Schedule III mandatory
  • Prohibition of fraudulent and unfair trade practices must be observed
  • Intermediary obligations under Regulation 13(1) must be fulfilled
  • Compliance with SEBI Circular dated December 13, 2021 mandatory

Important Dates

  • April 1, 2021 to March 22, 2023: Inspection period
  • March 20-22, 2023: On-site inspection conducted
  • April 10, 2023: Inspection findings communicated to Noticee
  • April 28, 2023: Noticee submitted reply to SEBI observations
  • December 30, 2025: Adjudication order date

Impact Assessment

This adjudication proceeding demonstrates SEBI’s continued enforcement focus on Research Analyst compliance, particularly regarding:

  1. Code of Conduct violations: Multiple alleged breaches of Schedule III provisions
  2. PFUTP concerns: Alleged violations of fraudulent and unfair trade practices regulations
  3. Intermediary obligations: Non-compliance with intermediary registration and operational requirements
  4. Industry signal: Reinforces regulatory expectations for Research Analysts regarding disclosure, conduct standards, and operational compliance

The case affects one registered Research Analyst and serves as a compliance reminder to all RAs regarding meticulous adherence to regulatory obligations, particularly those introduced via the December 2021 circular.

Impact Justification

Individual enforcement action against single research analyst; sets regulatory precedent but limited market-wide impact