A total of 185 applications related to violations of securities regulations were resolved through settlements with the capital markets regulatory body, SEBI, in the fiscal year 2023. These settlements resulted in SEBI collecting Rs 125.56 crore in settlement charges.
This figure stands in contrast to the 285 applications that were resolved through the issuance of suitable settlement orders during FY23, as reported in SEBI's recent annual report.
"Settlement orders were passed for alleged violations of various regulations, viz., SAST Regulations, 2011; PIT Regulations, 2015; PFUTP Regulations, 2003; LODR Regulations, 2015; FPI Regulations, 2019; AIF Regulations, 2012; RTA Regulations, 1993 and MF Regulations, 1996", SEBI said in its annual report.
Through the settlement mechanism, an accused party can resolve an ongoing case with the regulatory authority by remitting a settlement fee, without confessing or repudiating the alleged wrongdoing. This mechanism serves as a means to ensure swift and effective resolution of disputes.
In the fiscal year 2023, the Securities and Exchange Board of India (SEBI) encountered 386 settlement applications, with 221 applications pending at the outset of the period. Throughout the year, 185 applications were resolved through the issuance of requisite orders, while 285 applications were either declined, withdrawn, or returned. As the period concluded, 137 applications remained pending.
" Of the 185 applications settled during the year, an amount of `125.56 crore was remitted to the Consolidated Fund of India (CFI) as settlement amount, including Rs3 lakh towards summary settlement amount. In addition to this, Rs3.88 crore was agreed to be paid as the disgorged amount that was credited to the IPEF and `44.27 lakh was paid as legal charges", SEBI said in its annual report.
Furthermore, a sum of Rs 118.85 crore and Rs 2.08 crore was obtained as settlement payments, stemming from comprehensive settlement orders encompassing 10,981 entities under the SEBI Settlement Scheme, 2022, and 125 brokers within the purview of the SEBI Settlement Scheme for Stock Brokers, 2022, respectively. These funds were also directed to the Consolidated Fund of India (CFI).
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