The National Stock Exchange (NSE) and BSE has suspended membership of Karvy Stock Broking with immediate effect. This, after Karvy Stock Broking misused over Rs 2,300 crore in client money.
Both exchanges issued a circular on December 2 suspending Karvy’s membership from all segments: equity, derivatives and commodities. The Multi Commodity Exchange of India (MCX) may also suspend its membership next, a source close to development told Moneycontrol.
The exchanges and market regulator SEBI will provide sufficient time to sub-brokers to close their positions, another source stated.
Moneycontrol was the first to report on Karvy defaulting on client money. Funds of over 90,000 clients are stuck.
The Securities and Exchange Board of India (SEBI) has banned Karvy from taking on new clients over suspected illegal use of clients’ shares. The brokerage allegedly diverted the funds to its real estate arm.
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