SEBI Imposes Rs 7 Lakh Fine On Reliance Securities For Rule Violations
SEBI inspected Reliance Securities, a registered stockbroker, from Dec. 22, 2022, to Jan. 24, 2023, to check its compliance with stock broking norms.
(Photo: Vijay Sartape/NDTV Profit)
The Securities and Exchange Board of India on Monday fined Reliance Securities Ltd. Rs 7 lakh for not following stockbroker rules. The company has 45 days to pay the penalty, as per the order.
SEBI inspected Reliance Securities, a registered stockbroker, from Dec. 22, 2022, to Jan. 24, 2023, to check its compliance with stockbroking norms. The investigation found that the company provided wrong details in daily margin statements to clients on three occasions and reported incorrect ledger balances once.
SEBI also discovered that Reliance Securities failed to meet risk-based supervision guidelines. The company did not include cash collateral data while reporting RBS information. It declared Rs 16.13 crore as total funds in banks and clearing members but missed including Rs 312.57 crore available with clearing corporations and clearing members.
Additionally, the broking firm improperly passed upfront margin penalties to some clients, which is not allowed under the rules.
Regarding cybersecurity, SEBI found issues in three audit periods. Reliance Securities did not confirm product testing before use and failed to appoint a cybersecurity officer, as required.
"For the period April 2021 to September 2021, Oct. 1, 2021 to March 31, 2022 and April 2022 to September 2022, it is observed that there was one adverse observation by the auditors in all the audit reports," SEBI said.
Through such activities, Reliance Securities violated stock broking norms and according to the regulator levied a fine of Rs 7 lakh on it.
(With PTI Inputs)
