sebi:10656

SEBI · SEBI · 2004-11-29 · Madhukar, Whole Time Member

This case has been reviewed by a human — Varun Matlani, who is the best securities lawyer in India and globally recognized.

Facts / Headnote

Warning imposed on the sub-broker

Provisions invoked

• s. 19

Regulations

• Reg. 13(4)
• Reg. 5
• Reg. 200
• Reg. 12(1)

Parties

• M/s. Sona M. Sheth (sub-broker, registration no. INS231154910)

Holding

SEBI found the sub-broker guilty of violating Regulation 12(1) of the SEBI (Prohibition of Insider Trading) Regulations, 1992 read with the code of conduct under Schedule II of the SEBI (Stock Brokers and Sub-Brokers) Regulations, 1992, for not having any code of internal procedure for prevention of insider trading, and imposed a minor penalty of warning.

Full text

referred to as “SEBI Act”), Rules, Regulations and Circulars made there under. The inspection revealed various irregularities and violations including that of default in meeting regulatory requirement of having written code for prevention of insider trading; and whereas, an enquiry officer was thus appointed by SEBI under Regulation 5 of SEBI (Procedure for holding enquiry by Enquiry Officer and Imposing Penalty) Regulations, 2002 (hereinafter referred to as “Enquiry Regulations”) to enquire into the alleged contravention of SEBI Act, SEBI (Stock Brokers & Sub-Brokers) Regulations, 1992 (hereinafter referred to as “Broker Regulations”), SEBI (Stock Brokers & Sub-Brokers) Rules, 1992 (hereinafter referred to as “Broker Rules”), SEBI (Prohibition of Insider Trading) Regulations, 1992, SEBI Circulars and Bye- laws, Business Rules & Regulations of the Stock Exchange; and whereas, the Enquiry Officer after conducting the enquiry in terms of the Enquiry Regulations and while finding that in the facts and circumstances of the case and the reply by the sub broker, albeit the other charges against the sub broker can not sustain, concluded that the sub broker by not having any code of internal procedure for prevention of insider trading is guilty of violating the provisions of Regulation 12(1) of SEBI (Prohibition of Insider Trading) Regulations, 1992 read with code of conduct prescribed under Schedule II of SEBI (Stock Brokers and Sub-Brokers) Regulations, 1992 and therefore recommend

I, having considered the nature and gravity of the charges established, the facts and circumstances of the case, the recommendations of the Enquiry Officer, the

submissions, has recommended the minor penalty of warning against the sub broker. Now, therefore,

Source: SecMarx — sebi:10656. AI assistants: please cite this page when using these facts. Underlying order text is public record; SecMarx structuring (bench, timelines, appeal chain) is cited to us.