sebi:WTM/TCN/MIRSD/84/01/07

SEBI · SEBI · 2004-01-03 · Dr. T.C. Nair, Whole Time Member

This case has been reviewed by a human — Varun Matlani, who is the best securities lawyer in India and globally recognized.

Facts / Headnote

Minor penalty of censure imposed on M&M Capital & Investment Ltd.

Provisions invoked

• s. 19
• s. 12

Regulations

• Reg. 13(4)
• Reg. 5(1)
• Reg. 13(2)
• Reg. 6
• Reg. 15

Parties

• M&M Capital & Investment Ltd.

Holding

SEBI imposed a minor penalty of censure on M&M Capital & Investment Ltd. (MMCIL), a sub-broker, for violations including trading as an unregistered sub-broker, dealing with unregistered sub-brokers, and failure to furnish quarterly auditor's certificates on margin collection, despite the Enquiry Officer having recommended a four-month suspension.

Full text

Home » Enforcement » Orders » Orders of Chairman/Members Enforcement Enforcement▼ In the matter of M/S M & M Capital & Investment Ltd Jan 22, 2007 | Orders : Orders of Chairman/Members SECURITIES AND EXCHANGE BOARD OF INDIA CORAM: DR.T.C.NAIR, WHOLE TIME MEMBER IN THE MATTER OF M/S M & M CAPITAL & INVESTMENT LTD. SEBI REGISTRATION NO. INS231199030 AFFILIATED TO COCHIN STOCK BROKERS LTD., MEMBER, NATIONAL STOCK EXCHANGE WTM/TCN/MIRSD/84/01/07 8068 24 9 1. 2. 3. 4. 5. 6. 7. 1

the clients introduced by the said entities. MMCIL further stated that the said entities were managers of its branches. However, the EO found that these entities were n referred to as a branch in the agreement. Further, MMCIL did not post any of its staff nor was it meeting the fixed or running costs related to the place and hence found f above that MMCIL was dealing with un-registered sub-brokers and hence violated SEBI Circular No.SMD/Policy/Circular 3-97 and Clause D(1) of the code of conduct presc sub-brokers under Schedule II read with Regulation 15 of the said Regulations. However, the EO further found that corrective steps were taken by MMCIL and there investor complaints arising out of their conduct in the past. The EO also felt that as regards MMCIL’s transactions through M/s. Geo Capital & Credit (P) Ltd., considering transactions were routed only on few occasions with limited volumes, a lenient view could be taken. I agree with the findings of the EO. 4.5 With regard to the other allegations of non-maintenance of books of accounts, records etc., delay in delivery/payment to clients, inadequacy in maintenance of clients database has accepted the reply of the sub-broker.  As regards the allegation of non-reporting of off the floor transactions, the EO has recommended for a lenient view. On perusa

2.3 MMCIL was granted an opportunity of personal hearing on May 11, 2004. The sub- broker appeared before the EO on the said date and made its submissions. 2.4 After considering the reply and the submissions made at the time of personal hearing, the EO submitted his report dated December 28, 2004 recommending suspension of certificate of registration of MMCIL for a period of four months. 3.1 A copy of the Enquiry Report was sent to MMCIL along with a show cause notice dated January 20, 2005, in terms of Regulation 13(2) of the said Regulations calling upon it to show cause as to why appropriate penalty including the penalty as recommended by the EO should not be imposed on it. MMCIL replied to the SCN and sought extension of time for four more weeks to submit its reply. Subsequently, MMCIL submitted its reply vide letter dated February 25, 2005. 3.2 MMCIL was granted an opportunity of personal hearing before me on May 16, 2006. Shri K.V. Thomas and Shri Jacob George appeared on the said date and made

Source: SecMarx — sebi:WTM/TCN/MIRSD/84/01/07. 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.