sebi:ORDER/GR/PU/2022-23/24239

SEBI · SEBI · 2022-04-28 · G. Ramar, Adjudicating Officer

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Facts / Headnote

Penalty imposed on the Noticee for violations of SEBI Act, SCRA, Broker Regulations and SEBI Circulars

Provisions invoked

• s. 15A
• s. 15
• s. 12A
• s. 12
• s. 15H
• s. 15B
• s. 15J
• s. 28A
• s. 23J
• s. 23
• s. 23D

Regulations

• Reg. 9
• Reg. 21

Parties

• Kripa Securities Private Ltd.

Holding

The Noticee, Kripa Securities Private Ltd., was held liable for violations including non-segregation of client funds, non-settlement of client accounts, incorrect margin reporting, client funding, non-issuance of contract notes, discrepancies in running accounts, and non-cooperation, and a total penalty of Rs. 10,00,000 was imposed.

Full text

Adjudication Order in the matter of Kripa Securities Private Ltd. Page 2 of 35 2. During the inspection, certain irregularities and violations of various provisions of SEBI Act, Securities Contracts (Regulation) Act, 1956 (“SCRA”), Regulations and Circulars by the Noticee were observed. Accordingly, the findings of the inspection observations were communicated to the Noticee on March 31, 2022 advising it to submit its explanation/comments together with supporting documents, if any, on the same. Subsequently, the Noticee had submitted its reply to the observations vide letter dated April 28, 2022. SEBI after examining those comments/ replies of the Noticee and not being satisfied with the same, it was allegedly observed the followings: a. Non-Segregation of client’s funds, b. Non-settlement of client’s accounts, c. Incorrect reporting of margin to exchange, d. client funding, e. Non-issuance of contract notes, f. discrepancies in running account, g. Discrepancies in e-mail ids and Mobile Numbers data of clients and h. Non-Cooperation.

Adjudication Order in the matter of Kripa Securities Private Ltd. Page 3 of 35 f. Clause 12 of Annexure-A of SEBI Circular SEBI/MIRSD/SE/Cir-19/2009 dated December 03, 2009, g. Clause 2(B) of SEBI Circular CIR/MIRSD/15/2011 dated August 02, 2011 and h. Regulation 21 of Securities and Exchange Board of India (Stock Brokers) Regulations, 1992 (Brokers Regulations)

Adjudication Order in the matter of Kripa Securities Private Ltd. Page 4 of 35 7. The said SCN was duly delivered on November 18, 2022 by SPAD and the same was acknowledged by the e-mail confirmation dated December 01, 2022, from the manager of the Noticee. Subsequently, vide e-mail dated December 08, 2022, the Noticee had sought time till January 15 to submit its reply in the matter. However, since more than 14 days had lapsed from the receipt of the SCN, vide e-mail dated January 03, 2023, an opportunity of personal hearing was granted to the Noticee on January 11, 2023.

Source: SecMarx — sebi:ORDER/GR/PU/2022-23/24239. 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.