The Securities and Exchange Board of India (SEBI) has introduced mandatory certification requirements for compliance officers of Alternative Investment Fund (AIF) managers, marking a significant regulatory development in India's alternative investment landscape. This new mandate represents the regulator's continued efforts to strengthen oversight and governance standards within the rapidly growing AIF sector.

Regulatory Framework Enhancement

The certification requirement specifically targets compliance officers who are responsible for ensuring that AIF managers adhere to regulatory guidelines and maintain proper operational standards. This move aligns with SEBI's broader initiative to professionalize key roles within the financial services industry and ensure that personnel handling critical compliance functions possess the necessary expertise and qualifications.

Compliance officers play a crucial role in the AIF ecosystem, serving as the primary point of contact between fund managers and regulatory authorities. They are responsible for monitoring adherence to investment guidelines, reporting requirements, and various regulatory obligations that govern AIF operations.

Impact on AIF Industry

The certification mandate is expected to elevate the professional standards within the AIF management industry. By requiring formal certification, SEBI aims to ensure that compliance officers possess comprehensive knowledge of regulatory frameworks, risk management practices, and industry best practices relevant to alternative investment funds.

This regulatory step comes at a time when India's AIF industry has been experiencing substantial growth, with increasing participation from both domestic and international investors. The enhanced compliance standards are likely to contribute to greater investor confidence and improved operational transparency across AIF managers.

Implementation and Compliance

AIF managers will need to ensure their compliance officers obtain the required certification to meet SEBI's new regulatory standards. This requirement underscores the regulator's focus on strengthening the internal control mechanisms within fund management organizations and ensuring robust compliance infrastructure.

The certification mandate reflects SEBI's proactive approach to regulatory oversight, particularly as the alternative investment sector continues to expand and attract diverse investor participation. This development is part of the regulator's ongoing efforts to maintain high standards of governance and operational excellence within India's capital markets ecosystem.

The Securities and Exchange Board of India (SEBI) has cancelled the registration of research analyst Purooskhan following a comprehensive investigation into the fraudulent misuse of his regulatory credentials by an unregistered investment advisory firm. The cancellation came after Purooskhan admitted during regulatory proceedings that he operates a grocery store and is no longer engaged in research analyst activities.

Investigation Origins and Investor Complaints

The case began when SEBI received investor complaints through its SCORES platform regarding the website "optionresearch.in" that was illegally using Purooskhan's registration number to offer investment advisory services. The platform promised guaranteed returns and no-risk trading strategies, misleading investors into believing it was SEBI-certified.

Investors reported paying substantial fees for advisory packages and subsequently suffering heavy trading losses after following the platform's advice. The investigation revealed that payment trails led to bank accounts belonging to Option Research Consultancy (ORC), a partnership firm operating without SEBI registration.

Enforcement Action Against Unregistered Firm

SEBI's probe established that ORC and its partners were conducting illegal investment advisory activities while fraudulently displaying Purooskhan's credentials to legitimize their operations. The regulator imposed comprehensive penalties on the unregistered firm.

Regulatory Proceedings and License Cancellation

SEBI initiated dual proceedings against Purooskhan under both adjudication and intermediary regulations. While adjudication proceedings found insufficient evidence of deliberate collusion or financial gain, the regulator identified serious lapses in his conduct as a registered intermediary.

The critical finding was that Purooskhan had shared his registered email password with an ORC partner, compromising regulatory communications and weakening investor protection safeguards. Following a show-cause notice issued in September 2025, Purooskhan requested cancellation of his registration.

During the final hearing, Purooskhan confirmed he was operating a small provision store selling daily essentials and was no longer engaged in research analyst work. SEBI cancelled his registration citing investor protection and market integrity concerns, emphasizing the importance of maintaining robust safeguards in the intermediary registration system.