Quick Summary
SEBI registered Portfolio Managers must accept a minimum client investment of Rs 50 lakh. Anyone offering account handling or PMS style services below that amount is likely unregistered. A signed disclosure document must be shared at least two days before any agreement. This checklist covers registration checks, agreement terms, and how to spot unregistered account handlers.
Fake contract notes. A false claim of NSE Investor Protection Fund cover. A partnership that supposedly didn’t need SEBI registration at all.
That’s the exact defence one operator gave SEBI, right before being fined.
He was managing money the same way plenty of “account handlers” still pitch today, for far less than the legal Rs 50 lakh entry point.
Before you hand your account to anyone, make sure they clear this checklist first.
How a Legitimate PMS Onboarding Actually Works
Notice what’s missing from this sequence: no pressure, no guaranteed number, no request for a personal account transfer.
1. Registration verification: you confirm the manager’s SEBI registration before any conversation about funds moves forward.
2. Disclosure document shared: you receive this at least two days before signing, covering strategy, fees, and risk.
3. Written agreement signed: a formal contract sets out both parties’ rights and obligations clearly.
4. Minimum investment confirmed: your commitment meets or exceeds the Rs 50 lakh regulatory floor, transferred to a verified account.
5. Regular reporting begins: you start receiving periodic statements showing exact holdings and performance.
PMS Verification Checklist
Before signing anything or transferring funds, confirm each point below.
- SEBI registration: Verify the portfolio manager’s registration under SEBI Portfolio Managers Regulations, 2020.
- Minimum investment: Confirm the entry amount meets or exceeds the Rs 50 lakh regulatory floor.
- Written agreement: A formal agreement must define the relationship, rights, and obligations clearly.
- Disclosure document: This must be shared at least two days before you sign anything, not after.
- No guaranteed returns: A registered portfolio manager cannot promise or assure fixed profit levels.
- Fiduciary duty: The manager must act in your best interest, not push in house or affiliate products.
- Regular reporting: You should receive periodic statements showing exact holdings and performance.
How to Confirm Registration Yourself
Search the SEBI website under Intermediaries, Recognised Intermediaries, then Portfolio Manager.
Match the entity name exactly against your agreement and any communication you’ve received.
A related read worth checking is SEBI registered account handling, which explains what legal account handling actually looks like.
A Documented Enforcement Pattern
One SEBI order fined operators running unregistered PMS activity through pooled bank accounts.
They issued fake contract notes and falsely claimed investor protection fund coverage to appear legitimate.
Watch for exactly these tactics: pooled transfers, fake documentation, and vague fund protection claims dressed up as reassurance.
Below Rs 50 Lakh Is Not a Grey Area
Some pitches frame the Rs 50 lakh floor as a formality that can be worked around for smaller, trusted clients.
It isn’t. Anyone offering to manage a smaller amount under a PMS style structure is operating outside the law by definition.
There’s no smaller, unofficial version of legal portfolio management, only an unregistered one.
Bottom Line
Registration and the Rs 50 lakh floor together are your two fastest filters for a real PMS.
For the full SEBI registration check process across every intermediary type, visit the Fraud Free checklist series.
Already handed funds to an unregistered handler? You can file a complaint against a portfolio manager through the correct process.
Frequently Asked Questions
SEBI requires a minimum client investment of Rs 50 lakh for registered Portfolio Management Services. Any offer to manage your account for a smaller amount is very likely operating outside SEBI regulation.
No. SEBI rules bar portfolio managers from promising or assuring fixed returns. Genuine managers present past performance data only as a reference, never as a guarantee of future results.
You should receive a disclosure document at least two days before signing, detailing fees, risks, and past performance, along with a written agreement covering your rights and the manager's obligations.
No. Legal portfolio management under SEBI requires a minimum Rs 50 lakh investment. Anyone offering to handle a smaller trading account for you is operating an unregistered and illegal arrangement.
Visit SEBI's website, go to Intermediaries, then Recognised Intermediaries, and select Portfolio Manager. Search by the firm's name or registration number to confirm current registration status.
Documented cases include pooled bank accounts instead of individual settlement, fake contract notes, and false claims of investor protection fund coverage to appear more credible than they were.
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