Factors for assuring confidentiality in a settlement application filed under Chapter IX of the SEBI (Settlement Proceedings) Regulations, 2018.

SEBI/HO/EFD2/CSD/CIR/P/2019/0000000072 · 2019-06-18 · SEBI Enforcement Department 2 Settlement Division

Summary

This circular outlines the factors SEBI considers when assessing confidentiality for applicants providing assistance in settlement proceedings under Chapter IX of the SEBI (Settlement Proceedings) Regulations, 2018. The assessment evaluates the nature and value of cooperation provided, the gravity of the subject matter violations, and any adverse history or conduct by the applicant. These guidelines are issued to ensure transparency and fairness in granting reduced settlement charges and confidentiality to whistleblowers.

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A person who may have committed a violation of securities laws, other than those detailed in Tables VII to IX of Schedule II of the SEBI (Settlement Proceedings) Regulations, 2018, may make full disclosure of such violation and also provide substantial assistance... for the purpose of seeking grant of confidentiality and reduced settlement charges.

In order to assure confidentiality to an applicant who provides assistance in examination proceedings, the Board may assess the information/assistance/co-operation rendered during such examination proceedings by inter alia considering, the following factors:-

Whether the co-operation was provided before he or she had any knowledge of any pending examination proceedings and related action;

Whether the applicant was the first person to report the misconduct to the Board or to offer co-operation and such co-operation was truthful, complete and reliable;

Whether the co-operation was voluntary or pursuant to the terms of an agreement with any other law enforcement or regulatory organization/agency;

Whether the co-operation resulted in substantial assistance in conclusion of such examination proceedings and resulted in conserving of time and resources;

Whether any hardship was experienced by the applicant as a result of such co-operation;

Whether the applicant provided non-privileged information, which was not requested by the Board but otherwise might not have been discovered;

Whether the co-operation was in the form of original information (sufficiently specific and credible) to cause the Board to commence an examination proceedings or to inquire concerning different conduct as part of a current examination proceedings;

Whether the Board brought a successful judicial or civil and administrative action based on the original information.

Whether the applicant encouraged/authorized others to assist the Board who might not have otherwise participated in the examination proceedings.

The nature and type of defaults under the securities laws;

Source: SecMarx — Factors for assuring confidentiality in a settlement application filed under Chapter IX of the SEBI (Settlement Proceedings) Regulations, 2018.. Verbatim text is public record; SecMarx structuring (linkage to applying orders) is cited to us.