sebi:WTM/PS/22/MIRSD-5/DEC/2012
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Facts / Headnote
Certificate of Registration of sub-broker cancelled
Provisions invoked
- s. 19
Regulations
- Reg. 28(2)
- Reg. 38(2)
Parties
- Mr. Samir K. Chotai (trade name Om Shares and Securities)
Holding
The certificate of registration of sub-broker Mr. Samir K. Chotai (trade name Om Shares and Securities) bearing SEBI Registration No. INS 011251019 was cancelled for violations of SEBI regulations and circulars.
Full text
Page 2 of 4 3. The Enquiry Officer enquired into the alleged violation of the provisions of the SEBI (Criteria for Fit and Proper Person) Regulations, 2004, SEBI (Prohibition of Fraudulent and Unfair Trade Practices relating to Securities Market) Regulations, 1995 (hereinafter referred to as ‘PFUTP Regulations’), the Code of Conduct prescribed for the sub-brokers under Schedule II of the SEBI (Stock Brokers and Sub-Broker) Regulations, 1992 (hereinafter referred to as ‘Broker Regulations’), SEBI Circulars, Bye laws/ Business Rules and Regulations of the Stock Exchange. The Enquiry Officer/ Designated Authority (hereinafter referred to as the ‘Designated Authority’) submitted his Report dated March 08, 2011 under the SEBI (Intermediaries) Regulations, 2008, recommending thereby a penalty of cancellation of the Certificate of Registration of Samir for the violation of the aforesaid Regulations and Circulars.
Page 3 of 4 record. 5. I note that Samir has not filed any reply to the SCN or to the Report of Designated Authority. It is seen from the interim order that Samir was found guilty of entering into and executing trades outside the trading mechanism provided by BSE, thereby making illegal trades. Samir is also found to have settled such illegal trades in cash on a weekly/ fortnightly/ monthly basis without collecting margin from any of the clients and actual receipt/ delivery of securities either in physical or demat mode. Further, Samir had not maintained client registration forms and the broker-client agreement. These activities of Samir are clearly in violation of SEBI Circulars bearing numbers SMD/POLICY/CIRCULAR/11-97 dated May 21, 1997, SMDRPD/Policy/Cir-6/2001 dated February 01, 2001, SMD/Policy/Cir-12/2002 dated May 17, 2002 and SEBI/MRD/SE/Cir-33/2003/27/08 dated August 27, 2003.
Page 4 of 4 failed to perform its duties as specified in the code of conduct for sub-brokers in the Broker Regulations and violated the provisions of SEBI (Criteria for Fit and Proper Person) Regulations, 2004, SEBI (Prohibition of Fraudulent and Unfair Trade Practices Relating to Securities Market) Regulations, 2003, SEBI Circulars bearing No. SMD/POLICY/CIR-11/1997 dated May 21, 1997, SMDRP/POLICY/CIR-32/99 dated September 14, 1999, SMDRP/Policy/Cir-06/2001 dated February 01, 2001, SMD/Policy/Cir-12/2002 dated May 17, 2002 and SEBI/MRD/SE/Cir-33/2003/27/08 dated August 27, 2003. Having considered the above, I agree with the recommendation of the Designated Authority.
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Source: SecMarx — sebi:WTM/PS/22/MIRSD-5/DEC/2012. 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.