In addition, they have been expelled from the membership of the exchange, the NSE said in three separate circulars.
The National Stock Exchange (NSE) has declared three stock brokers — Vrise Securities, Kaynet Finance and BMA Wealth Creators — as defaulters for non-compliance with the regulatory provisions of the bourse. In addition, they have been expelled from the membership of the exchange, the NSE said in three separate circulars. The move effective from February 13 has been taken as these brokers failed to comply with the NSE guidelines, they added. Under the guidelines, stock brokers are required to fulfill their obligations and should not involve in any misconduct, or unprofessional conduct among others.
In January, the markets regulator Sebi had prohibited Vrise Securities from registering any new client for six months for violating broker norms and in the same month, Sebi imposed a fine of Rs 3 lakh on the broker for not complying with Securities Contract Regulation Act (SCRA). Separately, Sebi last month confirmed its interim order that restrained BMA Wealth Creators (now known as BRH Wealth Kreators) from the securities market for its failure to segregate securities of clients, failure to unpledge and return the securities to the clients upon fulfilment of pay-in obligation and making unauthorised transfer of shares from the client’s demat accounts.
The Securities and Exchange Board of India (Sebi) on Thursday said it has developed an online system to timely detect misuse of clients’ securities by stock brokers and alert exchanges in case of diversion of investors funds. This came after the regulator observed that some brokers have misused clients’ securities received as collateral to meet their own settlement obligation or obligations of other clients.