sebi:10658
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Facts / Headnote
Censure imposed on M/s. Magma Securities Ltd.
Provisions invoked
- s. 19
Regulations
- Reg. 13(4)
- Reg. 5
- Reg. 200
Parties
- M/s. Magma Securities Ltd.
Holding
SEBI censured M/s. Magma Securities Ltd., a sub-broker, for not segregating client funds from its own funds and for undertaking fund-based trading, imposing the minor penalty of censure as recommended by the Enquiry Officer.
Full text
Whereas, Securities and Exchange Board of India ( hereinafter referred to as SEBI ) conducted an inspection of the books of accounts and other documents of M/s. Magma Securities Ltd., a sub-broker, affiliated to OTCEI Securities Ltd., Member- NSE (hereinafter referred to as “sub-broker”) into the alleged violations of provisions of Securities and Exchange Board of India Act, 1992 (hereinafter referred to as “SEBI Act”), Rules, Regulations and Circulars made there under. The inspection revealed various irregularities and violations to have been committed by the sub broker including those of non segregation of client funds from its own funds and instance of trade transfer; and Whereas vide order dated January 08, 2004 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, Securities Contract (Regulation) Rules, 1957, 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 Circulars, 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 of the sub broker, albeit the other charges against the sub broker
whereas, a copy of the said Enquiry Report was forwarded to the sub broker along with a show cause notice dated October 28, 2004 advising it to show cause as to why appropriate penalty including penalty as recommended by the Enquiry Officer should not be imposed on it ; and whereas, the sub broker replied to the said show cause notice vide its letter dated November 08, 2004 saying that its submissions already made before the Enquiry Officer and / or submissions made in response to earlier correspondences with SEBI may be taken into account; and whereas, the sub-broker also requested for reconsideration of the matter and requested for dropping of the penalty by taking a lenient view in the matter; and whereas, it is observed that the enquiry officer having considered the detailed
DATE : 30/12/2005 PLACE: MUMBAI MADHUKAR WHOLE TIME MEMBER SECURITIES AND EXCHANGE BOARD OF INDIA
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Source: SecMarx — sebi:10658. 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.