Edelweiss Securities settled a case related to alleged violation of stock broker regulations with the Securities and Exchange Board of India by paying over Rs 35 lakh towards settlement charges.
The market regulator had initiated adjudication proceedings against the firm in November 2016 after it observed that the firm made proprietary fund pay from client bank accounts and thereby failed to segregate client funds and own funds.
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Besides, the firm mapped its own bank account instead of the client's in the demat accounts, where the securities of client were kept and did not use the word "client" in the name of client bank accounts.
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Further, there were alleged lapses in the internal control measures for access to institutional trading desk dealing room operation, SEBI said.
By doing so, the firm allegedly violated provisions of stock brokers regulations.
While the proceedings were pending, the firm filed a plea under the settlement mechanism without admitting or denying the guilt in August 2018.
The company in its meeting with the regulator's internal committee in December 2018 proposed to pay Rs 35.31 lakh towards settlement charges.
The amount was approved by the panel of whole-time members of SEBI, the regulator said in a settlement order.
Edelweiss paid Rs 35.31 lakh towards settlement charges on Feb. 27, following which the regulator has disposed of the pending adjudication proceedings.
Enforcement actions, including restoring or initiating the proceedings, could be initiated if any representation made by the firm is found to be untrue, the Sebi order said.
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