Sebi has cancelled the registration of Capital Stroke Investment Services and barred the investment adviser from the securities market for five years after finding multiple regulatory violations, including promises of assured returns and misleading representations to clients.
New Delhi, October 17 — The Securities and Exchange Board of India (Sebi) has cancelled the registration of Capital Stroke Investment Services and imposed a five-year ban from the securities market over multiple violations of investment advisory regulations.
In a final order passed on October 15, the market regulator found that the investment adviser had allegedly made misleading representations to attract customers.
Among the violations cited by Sebi were promises of specific profits through phone calls and the use of false client testimonials on its website.
The regulator also found significant shortcomings in employee qualifications.
According to Sebi, only seven of the company’s 314 employees held NISM certification, even though around 35 employees were involved in investment advisory-related activities.
NISM certification is an important regulatory qualification for professionals carrying out certain securities-market and investment advisory functions.
Sebi also flagged the alleged submission of forged documents during inspection, along with arbitrary fee practices and repeated charging of clients for the same advisory service before the earlier service period had expired.
Other violations included failures to properly communicate advisory details to customers and disclose or assess their risk profiles.
The regulator also found Capital Stroke Investment Services involved in activities connected with Green Wealth’s unregistered investment advisory operations.
Based on these findings, Sebi concluded that the company had violated investment adviser regulations and other securities-market rules.
The regulator consequently cancelled the entity’s registration and imposed a five-year restraint from accessing the securities market.
However, Sebi said the final duration of the restriction would be calculated after adjusting for the period of debarment already served under earlier interim and confirmatory orders.
The proceedings followed a post-enquiry show-cause notice issued on January 5, 2026.
The underlying inspection covered the period from April 1, 2019 to September 22, 2020.
The order reinforces Sebi’s regulatory focus on preventing misleading investment advice, protecting investors from promises of assured returns and ensuring that registered advisers meet required professional and compliance standards.
