sebi:ORDER/SBM/ASR/2022-23/17390-17407
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Facts / Headnote
Violations upheld against the Noticees; monetary penalties imposed under Sections 15HA/15HB of the SEBI Act and Section 23H of the SCRA
Provisions invoked
- s. 11
- s. 15A
- s. 15
- s. 19
- s. 12A
- s. 12
- s. 11(2)
- s. 15H
- s. 27
- s. 15I
- s. 15J
- s. 11C
- s. 15F
- s. 11C(2)
- s. 141
- s. 25
- s. 23
- s. 23H
- s. 23J
- s. 11C(5)
Regulations
- Reg. 3
- Reg. 2(1)(c)
- Reg. 16
- Reg. 26(1)
- Reg. 26(2)
- Reg. 26
- Reg. 2
- Reg. 47
- Reg. 9
- Reg. 3(d)
- Reg. 2(i)
- Reg. 48
- Reg. 41
- Reg. 41(2)
- Reg. 11(2)(i)
- Reg. 201
- Reg. 48(2)
Holding
The Adjudicating Officer held that NSE, its MD/CEO and key management persons, Sampark and its personnel, and stock brokers W2W and GKN with their directors/employees violated PFUTP, SECC and related circulars by creating and using discriminatory low-latency P2P connectivity, and imposed monetary penalties.
Full text
Page 2 of 186 Way2Wealth Brokers Private Ltd AAACW3290M Mr. M R Shashibhushan ABDPB4470B Ms. Rima Srivastava AECPS3267F Mr. Parshant Mittal BDTPM2680R
Page 3 of 186 connectivity from Sampark Infotainment Private Limited (hereinafter referred to as ‘Sampark’/’Noticee 7’). Therefore, an Expert Committee was constituted by SEBI to examine the matter in detail. The Board of NSE was advised by SEBI to, interalia, initiate an independent examination (including forensic investigation by an external agency) of all the concerns highlighted in the SEBI expert committee report, including lack of processes which allowed this to happen and collusion, if any, and fix accountability for the aforesaid breaches covering NSE and stock brokers, vendors and outsourced entities involved in the issue. The Board of NSE appointed Deloitte Touche Tohmatsu India LLP to conduct the forensic investigation into the allegations stated in the aforesaid complaints.
Page 4 of 186 of the stock brokers, to the extent possible, from such mechanism during the Investigation Period. 4. Pursuant to the investigation conducted in the matter, it was alleged that Sampark/ Noticee 7 arranged the cabling in the co-location rack of NSE in such a manner that some stock brokers, Way2Wealth Brokers Private Limited (hereinafter referred to as ‘W2W’ / ‘Noticee 10’) and GKN Securities (herein after referred to as ‘GKN’ / ‘Noticee 15’) had lower latency compared to other trading members connected to the Sampark Multiplexer (hereinafter referred to as ‘MUX’) placed in NSE Meet Me Room (hereinafter referred to as ‘MMR’). On the basis of investigation conducted by SEBI, several entities are alleged to have violated various provisions of law for which adjudication was initiated against them under Sections 15HA and 15 HB of the SEBI act and Section 23 H of the SCRA, as applicable. The details of alleged violations are mentioned in the table below: Table-1 Sr. No. Entity name/Noticee no. Provision of law/regulation violated Charging Provisions
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Source: SecMarx — sebi:ORDER/SBM/ASR/2022-23/17390-17407. 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.