sebi:WTM/PS/23/IVD/ID-9/AUG/2011
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Facts / Headnote
Enquiry proceedings disposed of with warning to be more careful and cautious; 2-month suspension recommended by Enquiry Officer not imposed
Provisions invoked
- s. 19
Regulations
- Reg. 7
- Reg. 4
- Reg. 5(1)
- Reg. 13(2)
- Reg. 13
- Reg. 28(2)
- Reg. 3(2)
- Reg. 38(2)
Parties
- B.M. Gandhi Securities Private Limited
Holding
The charge of violation of PFUTP Regulations against B.M. Gandhi Securities Private Limited was held not established, but the noticee was held to have failed to exercise due skill, care and diligence as a stock broker in supervising its sub-broker, and the proceedings were disposed of with a warning to be more careful instead of the 2-month suspension recommended by the Enquiry Officer.
Full text
Page 2 of 5 3. Based on the findings of the investigation, SEBI initiated enquiry proceedings against the noticee in terms of SEBI (Procedure for Holding Enquiry by Enquiry Officer and Imposing Penalty) Regulations, 2002 (hereinafter referred to as ‘Enquiry Regulations’), by appointing an Enquiry Officer under Regulation 5(1) of the Enquiry Regulations vide order dated May 13, 2003 read with subsequent order dated July 24, 2003. SEBI appointed the Enquiry Officer, to enquire into the alleged violation of the provisions of the SEBI (Prohibition of Fraudulent and Unfair Trade Practices relating to Securities Market) Regulations, 1995 (hereinafter referred to as ‘PFUTP Regulations’) and the SEBI (Stock Brokers and Sub Brokers) Regulations, 1992 (hereinafter referred to as ‘Broker Regulations’). The Enquiry Officer submitted his Report dated February 08, 2005, in terms of Regulation 13 (1) of the Enquiry Regulations recommending a penalty of suspension of the certificate of registration of the noticee for a period of two months for violating the provisions of Regulation 7 read with Schedule II of the Broker Regulations and Regulation 4 of the PFUTP Regulations.
Page 3 of 5 personal hearing was granted to the noticee on September 06, 2007. Due to change of the appropriate authority, a further opportunity of personal hearing was granted to the noticee on October 22, 2010. However, the noticee vide its letter dated October 21, 2010 requested for an adjournment on the ground of non-availability of its advocate. The request of the noticee was acceded to and the hearing was adjourned to November 19, 2010. On the scheduled date, Mr. Paresh B. Gandhi, Director of the noticee appeared along with Mr. Abdul Wahab A. H. Mukri, Advocate and made submissions.
Page 4 of 5 of SCL could not be proved. In absence of the material details like execution of the trades, etc. I am of the considered view that the charge of violation of PFUTP Regulations is not established as against the noticee.
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Source: SecMarx — sebi:WTM/PS/23/IVD/ID-9/AUG/2011. 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.