The board also asked Sebi to consider provisions for compensating victims of insider trading offences, while the regulator has been asked to continue to reject insider trading cases for any kind of settlement.
At the same time, it was also suggested that the regulator should consider "judgemental variations" in consent settlement amount on a case-to-case basis, rather than a formula-based determination of such charges.
After the end of a two-day meeting here, the advisory board also suggested immediate steps to tackle risks related to cyber security and any "internal sabotage" to the systems of various market infrastructures.
With regard to the proposed framework to allow REITs (Real Esate Investment Trusts) in India, the board suggested an internationally competitive taxation regime, better oversight of their managers and trustees and also a separate framework for Infrastructure Investment Trusts.
This was the third meeting of the IAB, which was constituted by Sebi in September 2011 as part of its efforts to respond to challenges arising from global financial crisis.
After deliberating on global best practices and lessons for India with regard to insider trading, the board observed that Sebi has put in place a comparable framework, the regulator said in a statement after the meeting.
"IAB suggested that Sebi should publicize major insider trading cases in a separate section on SEBI website for easier access, may have provisions to compensate victims, if any, of insider trading offences, and should encourage an effective whistle blowing framework in securities market by ensuring adequate legal protection of whistle blowers.
"Heavy penalty along with naming and shaming were also suggested to be used as major deterrence to insider trading and other offenses in the securities market," Sebi said.
The board also appreciated Sebi's policy of not settling cases of insider trading, while the regulator's overall revised consent settlement mechanism also came for discussion.
Under Sebi's consent mechanism, the regulator can settle cases under investigation for various offences after payment of certain charges without admission or denial of guilt.
The norms were revised in May 2012 after which certain major offences including insider trading have been kept out of the purview of consent settlement.