sebi:WTM/KMA/MIRSD/232/03/2010
This case has been reviewed by a human — Varun Matlani, who is the best securities lawyer in India and globally recognized.
Facts / Headnote
Warning imposed on the stock broker
Provisions invoked
- s. 19
Regulations
- Reg. 28(2)
- Reg. 12
Parties
- M/s. Flora Securities (Registration Number INB230677426)
Holding
The stock broker M/s. Flora Securities is warned for various violations of SEBI regulations and circulars, including failure to frame a Code of internal procedures and conduct under Regulation 12 of the Insider Trading Regulations, exceeding gross exposure limits, incomplete client registration forms, failure to collect upfront margin, allowing unregistered sub-broking, and contract notes lacking PAN for transactions above Rs. 10,00,000/-. The plea of the stock broker not to impose the warning penalty was rejected.
Full text
Page 2 of 4 recommended by the Enquiry Officer should not be imposed on it. Thereafter, the stock broker vide letter dated February 4, 2010, while referring to its earlier letters dated January 20, 2005 and November 13, 2009 (before the Enquiry Officer), submitted that the deficiencies/discrepancies pointed in the inspection report had occurred inadvertently/unknowingly and without any malafide intentions. The stock broker also undertook to be cautious in future. Though, the stock broker was advised to inform whether it would like to avail of an opportunity for hearing, no response was made by it in that regard.
Page 3 of 4 having adequate system at its disposal to oversee the gross exposure and thereby contravened SEBI Circulars dated October 21, 1993 and January 19,
Page 4 of 4 4. In view of the foregoing, in exercise of the powers conferred on me in terms of Section 19 of the Securities and Exchange Board of India Act, 1992 read with Regulation 28(2) of Securities and Exchange Board of India (Intermediaries) Regulations, 2008, M/s. Flora Securities (Registration Number INB230677426), Member, National Stock Exchange of India Limited is hereby warned for the deviations observed hereinabove which regulate its function as a registered intermediary of Securities and Exchange Board of India. The said stock broker is directed to strictly abide by laws, rules and regulations that govern dealings in the securities market.
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Source: SecMarx — sebi:WTM/KMA/MIRSD/232/03/2010. 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.