SEBI fines broker Inventure Growth Rs 3 lakh over lapses in supervising its agent
SEBI imposed a Rs 3 lakh penalty on stock broker Inventure Growth and Securities after finding it did not independently inspect an authorised person whose terminals placed a client's trades.
Key points
- A SEBI adjudicating officer imposed a penalty on stock broker Inventure Growth and Securities Ltd in an order dated 6 November 2026.
- The penalty is Rs 3 lakh under Section 15HB of the SEBI Act, payable within 45 days of receipt of the order, SEBI said.
- SEBI found the broker relied on self-signed audit reports from its authorised person; the order can be appealed before the Securities Appellate Tribunal.
The Securities and Exchange Board of India (SEBI) has imposed a penalty of Rs 3 lakh on stock broker Inventure Growth and Securities Ltd, according to an adjudication order dated 6 November 2026. SEBI found that the broker failed to carry out an independent audit of one of its authorised persons, the agent through whose trading terminals a client's orders were placed.
What Happened
SEBI investigated the trading of a client of Inventure, between 1 April 2020 and 31 March 2022, that was suspected of front running the trades of Axis Mutual Fund. Front running means trading ahead of a large investor's known orders. The investigation began from alerts in SEBI's internal system. According to the order, the client's account was opened through an authorised person of the broker, and the trades were executed from terminals allotted to that authorised person.
A show cause notice was issued on 11 November 2025. SEBI rules require a broker to inspect the offices of its authorised persons periodically, and NSE rules require each one to be inspected at least once every three years. The adjudicating officer found that the two internal audit reports Inventure submitted were undated and signed only by the authorised person himself, making them self-declarations rather than independent audits. The order records a statement by a promoter and director of the broker that the firm "relied on trust" during the Covid period instead of verifying the terminals. The officer rejected the broker's argument that it had shown due diligence.
The penalty was imposed under Section 15HB of the SEBI Act. The order says the material on record does not show any gain made or loss caused to investors. It notes earlier SEBI orders against the broker.
What It Means
A broker answers for the acts of its authorised persons, whose offices count as its branch offices. The order shows SEBI expects brokers to check those offices themselves, not accept the agent's own word. Inventure must pay within 45 days of receiving the order, failing which SEBI may start recovery proceedings. This is a regulator's finding and can be appealed before the Securities Appellate Tribunal. Investors with a complaint against a broker can use SEBI's SCORES portal at https://scores.sebi.gov.in.
Source: SEBI order
Sources & Citations
- SEBI order — Securities and Exchange Board of India