sebi:Order/SD/KS/2022-23/17042
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Facts / Headnote
Violations established on multiple counts; penalty imposed to be paid within 45 days (amount not in excerpt)
Provisions invoked
- s. 15
- s. 19
- s. 12
- s. 15H
- s. 15J
- s. 28A
- s. 23
- s. 19H
- s. 23D
- s. 19G
Regulations
- Reg. 7
- Reg. 6
- Reg. 9(f)
- Reg. 3
- Reg. 9
- Reg. 58
Parties
- Anand Rathi Share and Stock Brokers Ltd.
Holding
The Noticee was held to have violated Enhanced Supervision, Stock Broker, SCRR and depository participant provisions including misuse/misreporting of client funds, networth, RBS/weekly/monthly data, order evidence, retention statements, CKYC, transmission, account modification, concurrent audit and stamping requirements, and was held liable for penalty.
Full text
Adjudication Order in the matter of Anand Rathi Share and Stock Brokers Ltd. Page 2 of 58 APPOINTMENT OF ADJUDICATING OFFICER
Adjudication Order in the matter of Anand Rathi Share and Stock Brokers Ltd. Page 3 of 58 b. Clause 3.3.1 of annexure of Enhanced supervision circular.
Adjudication Order in the matter of Anand Rathi Share and Stock Brokers Ltd. Page 4 of 58 (f) and Rule 8 (3) (f) of Securities Contract (Regulation) Rules, 1957 read with SEBI Circular SMD/POLICY/CIR-6//97 dated May 07, 1997 And Clause A(5) of Schedule II read with Regulation 9(f) of SEBI (Stock Brokers) Regulations, 1992. F. Incorrect reporting of Networth vii. It was observed that TM has reported Networth of Rs. 26.40 crores as on 31-03-2019. However, it was observed that the Networth as per exchanges’ calculation was Rs.11.55 crore because of the following reasons a) Trading member has not deducted 30% of marketable securities, b) Advances given to associate company for their office expenses; c) Provision for doubtful debt has been reduced by TM from ageing value of doubtful debt overdue more than 90 days as on networth calculation day however TM could not substantiate that said provision belongs to said overdue debtors only and hence benefit of provision of doubtful is not given; d) Exchange have reduced 10% on marketable securities as per clearing member’s var on the same. In view of the discrepancy in calculation of networth / incorrect reporting of networth to exchange, it is alleged that Noticee had violated the provisions of Clause 6.1.1(j) of Annexure of SEBI Circular SEBI/HO/MIRSD/MIRSD2/CIR/P/2016/95 dated September 26, 2016 read with Rule 33 of Chapter II of the Rules of NSEIL and NSE Circular NSE/MEMB/2739 dated July 30, 2001. G. Failure in Reporting Risk Based
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Source: SecMarx — sebi:Order/SD/KS/2022-23/17042. 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.