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    Question

    Regulation 4 of SEBI (Prohibition of Fraudulent and Unfair Trade Practices Relating to Securities Market) Regulations, 2003, mentions "illegal mobilization of funds" in the context of: 

    A Collective investment schemes sponsored by registered entities Correct Answer Incorrect Answer
    B Activities related to securities and services in the securities market Correct Answer Incorrect Answer
    C Diversion of funds for purposes not approved by the Securities and Exchange Board of India Correct Answer Incorrect Answer
    D Fundraising activities undertaken by individuals or entities without proper authorization Correct Answer Incorrect Answer
    E Mobilization of funds for investment in listed securities Correct Answer Incorrect Answer

    Solution

    As per Reg 4- [(t) illegal mobilization of funds by sponsoring or causing to be sponsored or carrying on or causing to be carried on any collective investment scheme by any person.]29[Explanation 30{–1}For the purposes of this sub-regulation, for the removal of doubts, it is clarified that the acts or omissions listed in this sub-regulation are not exhaustive and that an act or omission is prohibited if it falls within the purview of regulation 3, notwithstanding that it is not included in this sub-regulation or is described as being committed only by a certain category of persons in this sub-regulation.]31[Explanation–2 Market Participant shall include any person or entity registered under Section 12 of the Act and its employees and agents.

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