sebi:WTM/GM/NRO/NRO/12473/2021-22
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Facts / Headnote
Warning issued; DA recommendation of 6-month suspension not accepted
Provisions invoked
- s. 19
- s. 12
Regulations
- Reg. 6
- Reg. 9
- Reg. 28
- Reg. 27
Parties
- Shri Parasram Holdings Private Limited
Holding
The Noticee violated SEBI Circular No. SEBI/MRD/SE/SU/Cir-15/04 dated 19 March, 2004 and Clauses A(1), (2), (3) and A(5) of the Code of Conduct for Stock Brokers by pledging clients' securities without authorization, and was warned to exercise caution, care and due diligence in future.
Full text
Order in the matter of Shri Parasram Holdings Private Limited Page 1 of 21 WTM/GM/NRO/NRO/12473/2021-22 SECURITIES AND EXCHANGE BOARD OF INDIA
Order in the matter of Shri Parasram Holdings Private Limited Page 2 of 21 shares/ securities from two banks namely, Indusind Bank (Loan account No. 606000586091) and Citibank (Loan account No. 0007606222). In this regard, the Noticee had stated that as on June 05, 2013 (i.e. the cut-off date for inspection/ examination), the loan facility was being availed against the shares/ securities of clients and not its own shares. The Noticee also stated that it provided margin trading facility to its clients, and the shares of only those clients who are availing margin trading facility were pledged with the banks. In respect of the same, the inspection team of SEBI sought the following information from the Noticee: a. Bank-wise, client-wise details of the securities pledged by the Noticee as on June 05, 2013. b. Value of the loan availed by the Noticee against the securities of the clients. c. Financial balance of the clients as on June 05, 2013 (fixed deposit/ margin/ money, if any, being taken from the clients to be quoted separately) etc. d. Copy of the agreement with the banks from where facility of Loan against Securities was availed by the Broker. e. Bank-wise, securities-wise details of pledged securities duly certified by the bank.
Order in the matter of Shri Parasram Holdings Private Limited Page 3 of 21 4. Accordingly, SEBI initiated enquiry proceedings against the Noticee under Chapter V of the SEBI (Intermediaries) Regulations, 2008 ("Intermediaries Regulations") and appointed a Designated Authority ("DA") to enquire into whether the alleged violations by the Noticee warranted cancellation or suspension of the certificate of registration granted by SEBI or any other action provided in Chapter V of the Intermediaries Regulations.
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Source: SecMarx — sebi:WTM/GM/NRO/NRO/12473/2021-22. 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.