The Securities and Exchange Board of India (SEBI) has announced new certification requirements for compliance officers managing Alternative Investment Funds (AIFs), marking a significant regulatory development in India's financial sector. The markets regulator issued a circular mandating that all AIF compliance officers obtain professional certification to enhance regulatory compliance standards.

New Certification Requirements

SEBI has specified that compliance officers of AIF managers must obtain certification from the National Institute of Securities Markets (NISM). The regulatory framework requires these professionals to pass the NISM Series-III-C: Securities Intermediaries Compliance (Fund) Certification Examination to qualify for their roles.

The certification requirement encompasses the following key parameters:

Implementation Timeline and Compliance

The regulatory change will take effect from January 1, 2027, providing the industry with adequate time to prepare for the new requirements. From this date, only certified professionals will be eligible for appointment as compliance officers or continue in existing compliance roles for AIF managers.

SEBI has also established additional compliance obligations for AIF stakeholders. The regulator has directed trustees, sponsors, and managers of AIFs to ensure that adherence to the new certification requirement is properly documented in their Compliance Test Reports prepared by the manager.

Regulatory Framework and Documentation

The markets watchdog has emphasized that compliance with the new certification requirement must be reflected in the documentation processes of AIF entities. This includes ensuring that all relevant stakeholders - trustees, sponsors, and managers - maintain proper records of certification compliance in their regulatory reporting.

Immediate Effect and Industry Impact

While the certification requirement becomes mandatory from 2027, the circular itself comes into force with immediate effect. This allows AIF managers and compliance professionals sufficient time to plan for the certification process and ensure seamless compliance with the new regulatory framework.

The move represents SEBI's continued efforts to strengthen regulatory oversight and professional standards within India's alternative investment sector, ensuring that compliance officers possess the necessary expertise to manage regulatory requirements effectively.

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.