ICICI Securities settles stock broker violation case with Sebi

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Published: November 29, 2019 1:10:53 AM

During the investigation, Sebi found that physical share certificates of 14 listed companies were fraudulently acquired in the names of 26 non-existing bogus entities.

ICICI Securities, Sebi, Karvy Stock Broking, stock broker norms, stock broker violation caseSebi is currently investigating Karvy Stock Broking, which has misused client securities for other unauthorised purposes.

ICICI Securities on Thursday informed the exchanges that it had settled a case of alleged violation of stock broker norms with the Sebi by paying over Rs 28 lakh towards settlement charges. “This was in relation to a settlement application submitted to the Sebi in the matter of two trading accounts that were opened at ICICI Securities in January 2007 and July 2008 by account holders by misrepresenting their identities,” ICICI Securities said in a release.

During the investigation, Sebi found that physical share certificates of 14 listed companies were fraudulently acquired in the names of 26 non-existing bogus entities. Of these 26 non-existing bogus entities, two entities dealt through ICICI Securities. It was thus alleged that there was lack of diligence on part of ICICI Securities. Sebi charged the brokerage firm for lack of due-diligence when they had dealt with these two entities.

The regulator’s order came at a time when brokerage firms are facing increased scrutiny from the exchanges and the regulator for misusing client securities and lack of diligence. Sebi is currently investigating Karvy Stock Broking, which has misused client securities for other unauthorised purposes.

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