Moneycontrol
Jul 14, 2017 04:16 PM IST | Source: PTI

Sebi fines Prime Broking Company for violating broker norms

A probe conducted by Sebi found that Prime Broking was holding 8.75 per cent stake in Aanjaneya Lifecare on behalf of its three clients -- Kannan Vishwanath, CSA Holdings and CLT Investments for more than two quarters

Sebi fines Prime Broking Company for violating broker norms

Markets regulator Sebi has imposed a penalty of Rs 3 lakh on Prime Broking Company for retaining the shares of Aanjaneya Lifecare (now known as Dr Datsons Labs Ltd) in respect of three clients for more than two quarters

A probe conducted by Sebi found that Prime Broking was holding 8.75 per cent stake in Aanjaneya Lifecare on behalf of its three clients -- Kannan Vishwanath, CSA Holdings and CLT Investments for more than two quarters -- (September and December) in 2012-13.

The shares of these clients were held as collateral and not released to them as they owed Prime Broking for margins and cash receivables, the regulator noted.

Accordingly, the accounts were not settled once in a quarter as required, Securities and Exchange Board of India (Sebi) said in an order dated July 13.

The regulator has levied the fine on the broker "for the retention of shares of Aanjaneya Lifecare of three clients without furnishing the periodical statement of securities account and without offering an explanation regarding retention of securities and the details of pledge, for more than two quarters."

By indulging in such activity, it has violated the provisions of Sebi's stock broker regulation.

In a separate order, Sebi has slapped a fine of Rs 3 lakh on Beardsell Ltd for not making the necessary disclosures within the prescribed time frame under SAST (Substantial Acquisition of shares and Takeovers) norms.

"I am convinced that the notice has failed to make the necessary disclosures within the prescribed time period required under ... SAST Regulations for the period 2002, 2007 and 2009," Sebi Adjudicating Officer Suresh B Menon said in an order.
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