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The orders were passed after the brokerage and its chief failed to pay the penalties imposed on them via an order issued by Sebi on April 28, 2023
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A recent SAT order had exposed the regulator, the depository and the exchange to a financial liability of over Rs 1,400 crore.
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This comes barely a month after the tribunal commented on the regulator's lackadaisical approach in the Kirloskar matter
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The matter relates to KSBL misutilising client securities worth Rs 2,300 crore, belonging to more than 95,000 clients, by pledging them from just one demat account.
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Chaturvedi is aiming at multiple acquisitions in the space of financial services both for attaining the size of business as well as for listing on bourses
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A minority shareholder brought to the notice of the tribunal that Karvy was indulging in selling assets and not properly accounting for the proceeds.
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ED had also earlier conducted searches at six locations of KSBL, in addition to freezing shares worth Rs 700 crores of Karvy Group held by Comandur along with his sons Rajat and Adiraj Parthasarathy.
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In November 2019, SEBI barred KSBL from taking new brokerage clients after it was found that the brokerage firm had allegedly misused clients' securities to the tune of over Rs 2,000 crore.
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Funds raised by Karvy by pledging shares of its six bankers were transferred to the firm's own bank accounts, and not into 'Stock Broker Client Account', which is in contravention with the SEBI guidelines, the police said.
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In a media release on November 23, NSE announced the expulsion of Karvy Stock Broking and declared it a defaulter.
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SEBI barred Karvy Stock Broking from taking on new clients and prevented it from using the Power of Attorney (PoA) given by clients after the broker was found guilty of having misused the securities of its clients.
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NEFT to be available 24x7 from December 16, RBI opens window for 'on-tap' licensing of Small Finance Banks
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SEBI mainly pursues attachment of properties in collective investment schemes where promoters fail to return the capital of small investors.
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The banks have sought immediate freezing of the securities transferred to clients' accounts. HDFC Bank has lent Rs 400 crore to Karvy based on these pledged shares
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The NSE and the BSE, on December 2, suspended Karvy's trading license with immediate effect.
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Both exchanges issued a circular on December 2 suspending Karvy’s membership from all segments: equity, derivatives and commodities
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SEBI has banned Karvy from taking new clients over suspected illegal use of clients’ shares.
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The regulator's decision to debar the brokerage from using PoAs was part of an ex-parte order issued last Friday barring the brokerage from taking new broking clients as it has misused the clients' securities for its own benefits.
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The market regulator is trying to understand why exchanges failed to notice lapses at Karvy. It is also trying to find out how exchanges failed to detect the illegal pledging of clients' shares by Karvy despite periodically auditing broking firms
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Most AMCs are also planning to inform the investors through a letter that they need not worry about their investments in mutual fund schemes.
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Bankers want to understand the extent of the problem and whether it will lead to a default by Karvy’s companies
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SEBI got wind of the goings on at Karvy in mid-October when the brokerage used clients funds for proprietary trading. The regulator then carried out a reconciliation exercise of the client accounts.
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The worry now is whether the scam is limited to Karvy
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The exchange's preliminary report is the result of the limited purpose inspection of KSBL conducted by it on August 19, covering a period from January 1 onwards
