SEBI imposes ₹9 lakh penalty on Reliance Securities for non-compliance with market norms | Representative Image/File
The capital market regulator Securities and Exchange Board of India (SEBI) has imposed Rs 9 lakh monetary penalty on Reliance Securities for “flouting market norms” and stock broker rules.
The market regulator’s order came after National Stock Exchange (NSE) and Bombay Stock Exchange (BSE) carried out a thematic onsite inspection of the books of accounts, records and other documents of authorised persons (APs) of Reliance Securities Ltd (RSL).
The inspection was necessitated to ascertain whether the same are being maintained in the manner required by RSL, concerning provisions of stock brokers rules, NSEIL Capital Market (CM) regulations and NSE Future & Options (FO) trading norms.
The inspection found that RSL allegedly failed to maintain required order placement records for offline clients mapped to its APs, namely Jitendra Kambad and Naitik Shah.
The market watchdog SEBI in its 47-page order found “multiple violations” committed by RSL and its authorised persons, including non-maintenance of adequate systems for recording client order placements, discrepancies in terminal locations, and lack of segregation at offices shared with other brokers.
SEBI flagged “unauthorised personnel operating these terminals”, breaching norms requiring terminals to be handled only by approved users. The inspection also exposed inadequate segregation at offices of RSL’s authorised persons the market regulator found that APs of RSL were found sharing premises and infrastructure with APs of other brokers violating regulatory rules.
The regulator noted that the lack of proper supervision allowed APs to engage in unauthorised activities, including receiving payments from clients for non-broking purposes.
RSL contended that “certain discrepancies were inadvertent”. It submitted that it took remedial steps, such as deactivating unapproved terminals and enhancing internal controls. It admitted to lapses but stated corrective measures had been undertaken, including deactivating terminals operated by unapproved users.
