SEBI finds Growthlift violated KYC norms, fee limits, and AML reporting

This order details SEBI's adjudication proceedings against Growthlift Investment Advisories Private Limited for alleged violations of KYC norms, employee qualification requirements, fee limits, and anti-money laundering reporting obligations.

Who it concerns: Growthlift Investment Advisories Private Limited

What SEBI found or ordered

• Alleged violation of KYC norms (Para 113-119 of SEBI Master Circular) for not obtaining registration with CKYC and KRA.
• Alleged violation of Regulation 7(1)(c) of IA Regulations, 2013, for employing 98 client-facing staff and one research assistant without requisite qualifications or intimation to SEBI/BASL.
• Alleged violation of Regulation 15A of IA Regulations, 2013, for charging fees exceeding ₹1,25,000 per annum to 16 clients and collecting ₹1,90,678 from 3 clients without PAN details.
• Alleged violation of AML/CFT guidelines (Clauses 61 and 62) for failing to intimate the appointment of the Principal Officer and Designated Director to FIU-IND.
• Adjudication initiated under Section 15EB of the SEBI Act, 1992.

Also in the document

• The inspection period covered April 01, 2022, to October 31, 2023.
• The company alleged that its 98 employees were solely responsible for onboarding new clients, not investment advice, but SEBI inferred they were deemed Persons Associated with Investment Advice (PAIA).
• The company claimed to have obtained CKYC registration (Institution Code: IN7713) after the inspection, which was not present in the initial findings.