sebi:ORDER/VV/NK/2021-22/12797
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Facts / Headnote
Violations established; penalty to be imposed under Section 23D of SCRA, Section 15A(b) and Section 15HB of SEBI Act
Provisions invoked
- s. 15A
- s. 15
- s. 12
- s. 15H
- s. 15J
- s. 28A
- s. 23J
- s. 23
- s. 23D
Regulations
- Reg. 65
- Reg. 9(f)
- Reg. 17(1)
- Reg. 21(1)
- Reg. 17(1)(g)
- Reg. 21
- Reg. 3(2)
- Reg. 16
Parties
- Kaynet Finance Limited
Holding
The Noticee Kaynet Finance Limited was found to have violated multiple provisions of SEBI Act, SCRA, SEBI (Stock Brokers) Regulations, and various SEBI/NSE circulars including misuse of client funds through unauthorized pledging of client securities, non-settlement of funds and securities, incorrect reporting of margin and net worth, non-submission of data, non-maintenance of books of accounts, and non-sending of securities pledge/unpledged statements to clients. The Adjudicating Officer proceeded to record findings of violations and determined that penalties under Section 23D of SCRA, Section 15A(b) and Section 15HB of SEBI Act are warranted.
Full text
Adjudication Order in the matter of inspection of Kaynet Finance Limited Page 2 of 41 3. Vide letter dated December 10, 2018 a copy of the inspection report alongwith its
Adjudication Order in the matter of inspection of Kaynet Finance Limited Page 3 of 41 V. Incorrect reporting of margin to the exchange: violation of Clause A(5) of Schedule II read with Regulation 9(f) of SEBI (Stock Brokers) Regulations, 1992 and NSE circular NSE/CMPT/03167 dated Feb 01, 2002, NSE circular NSE/CMPT/13061 dated September 10, 2009 and NSE circular NSE/INSP/19583 dated December 14, 2011.
Adjudication Order in the matter of inspection of Kaynet Finance Limited Page 4 of 41 XV. Securities pledged / unpledged statements were never sent to the clients: Violation of clause 2.5.5 of SEBI circular Ref no. SEBI/HO/MIRSD/MIRSD2/CIR/P/2016/95 dated September 26, 2016.
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Source: SecMarx — sebi:ORDER/VV/NK/2021-22/12797. 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.