SEBI Slaps Ban on Onelife Capital Advisors and Promoters for Financial Misrepresentation and Fund Diversion

The Securities and Exchange Board of India (SEBI) has imposed a ban on Onelife Capital Advisors Ltd (OCAL) and its promoters, Pandoo Naig and Prabhakara Naig, preventing them from accessing the securities market until further notice. This action follows allegations of fund diversion and misrepresentation in the company’s financials.

Alleged Financial Misrepresentation

SEBI’s investigation revealed that OCAL had been inflating its revenue and expenses, giving a misleading picture of the company’s business activities. These financial misstatements were aimed at creating a false image for the public. The company allegedly engaged in bogus sales and purchases, misrepresenting its financial health.

Diversion of Funds and Corporate Governance Issues

According to SEBI, OCAL was involved in multiple regulatory violations, including undisclosed transactions among related parties and diverting company funds as loans. The company also failed in terms of corporate governance, with compliance officers, auditors, and members of the audit committee allegedly turning a blind eye to these activities.

Impact on Promoters and Management

As a result of these violations, the promoters of OCAL, Pandoo and Prabhakara Naig, have been barred from acting as directors or key managers in any listed company that intends to raise public funds or any SEBI-registered intermediary. This restriction will remain in place until further orders.

Complaint and Investigation

The case came to light after SEBI received a complaint in October 2022. SEBI then conducted an investigation covering the period between April 2018 and March 2023. During this time, SEBI found significant violations of the Prohibition of Fraudulent and Unfair Trade Practices (PFUTP) norms and the Listing Obligations and Disclosure Requirements (LODR) rules.

Next Steps

SEBI has also issued a show-cause notice to OCAL, its promoters, and other individuals involved, asking them to explain why further actions or restrictions should not be imposed on them. The case highlights concerns about corporate governance and the protection of public shareholders, which SEBI aims to address through this action.