sebi:WTM/KMA/ERO/IVD/223/02/2010
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Facts / Headnote
Censure of the stock broker
Provisions invoked
- s. 19
Regulations
- Reg. 28
Parties
- M/s Arun Kumar Bhuwalka [Registration No. INB 0300772218], Member, Calcutta Stock Exchange Limited
Holding
SEBI censured stock broker M/s Arun Kumar Bhuwalka for failing to report off-the-floor transactions to the Calcutta Stock Exchange, in violation of Clause A(5) of the Code of Conduct under Schedule II of the Broker Regulations.
Full text
Page 2 of 3 Board of India (Procedure for Holding Enquiry by Enquiry Officer and Imposing Penalty) Regulations, 2002 (since repealed) to enquire into the alleged violations committed by the Broker. In the meanwhile, the said Regulations was repealed with effect from the notification of Securities and Exchange Board of India (Intermediaries) Regulations, 2008, (hereinafter referred to as the Intermediaries Regulations) and the Designated Authority (hereinafter referred to as the Enquiry Officer), vide Report dated May 19, 2009 recommended to censure the Broker for not reporting the off the floor transactions to CSE and thereby violating Clause A(5) of the Code of Conduct specified under Schedule II of the Broker Regulations.
Page 3 of 3 reiterated in this Order. The Enquiry Officer observed that the off the floor transactions were not reported by the Broker as required under SEBI Circular March 14, 1995 and thus, it had violated Clause A (5) of code of conduct for Stock Brokers Specified in Schedule II of the Broker Regulations. The Broker had not controverted the findings of the Enquiry Officer. Though, the Broker in its reply stated that it had timely informed all its transactions (market or off market) to its clients as well as to CSE, it could not produce any evidence in this regard. As mentioned above, the Broker agreed to accept the punishment. Considering the totality of the facts and circumstances of the case, the present enquiry proceeding initiated against the Broker is disposed of, as ordered hereinunder.
2. Pursuant to the submission of the Enquiry Report, SEBI issued a notice dated June 16, 2009 to the Broker advising it to show cause as to why the penalty as recommended by the Enquiry Officer or as considered appropriate by SEBI should not be imposed against it. A copy of the Enquiry Report was also forwarded to the Broker with the said show cause notice. The Broker was also advised to inform SEBI, whether he desired to avail an opportunity of hearing. As the Broker had not sent any reply, SEBI sent reminders dated August 20, 2009 and October 14, 2009. Thereafter, the Broker, vide letter dated nil (received by SEBI on October 26, 2009) stated that all its transactions (market or off market) has been timely informed to its clients as well as to CSE. The Broker also stated that he is agreeable to any punishment as SEBI may decide. Though, the Broker was advised to indicate whether it required a personal hearing, no response was made by it, in that regard. In view of the reply of the Broker, I do not consider it necessary to provide an opportunity of hearing to it and the present proceeding is being considered on the basis of the available material on record including the aforesaid reply of the Broker. The allegations against the Broker is that it had not reported the off the floor transactions executed by it, to CSE. As the details of such off the floor transactions were given in detail in the Enquiry Report and that the Broker had not disputed the execution such transactions
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Source: SecMarx — sebi:WTM/KMA/ERO/IVD/223/02/2010. 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.