Motilal Oswal Settles SEBI Proceedings On Record-Keeping Lapse By Partner Om Securities For Rs 34.85 Lakh

Motilal Oswal Financial Services on Thursday settled proceedings with regards to to involvement and non-maintenance of records by one of its authorised partners—Om Securities. The settlement amount stood at Rs 34.85 lakh.

Motilal Oswal, in a statement issued in relation to the matter, said, "The SEBI settlement order announced today relates to involvement and non-maintenance of records by one of our authorised partners (AP)- Om Securities. We had to opt for the settlement route and the matter now stands resolved."

The order came after Motilal Oswal proposed to settle instant proceedings initiated against it, "without admitting or denying the findings of facts and conclusions of law."

"...it is hereby ordered that the proceedings initiated against the applicant (MOFSL) vide SCN (Show Cause Notice) dated February 20, 2025, is disposed of in terms of settlement terms," Securities And Exchange Board of India's Quasi Judicial Authority Santosh Shukla said in the order.

The matter arose from an investigation carried out by SEBI to ascertain whether the trades of an entity (big client) was front run by certain entities i.e Chaturvedi Group during the period Jan. 1, 2022 to Dec. 8, 2023.

In Feb. 20, 2025, it was alleged that the brokerage failed to exercise due skill and care expected of a registered stock broker by not keeping proper records of client order instructions.

The markets watchdog also charged MOFSL with attempting to create supporting documents after the execution of trades, raising concerns over compliance standards, thereby flouting SEBI's (Stock Brokers) regulations, as per the order.

Pursuant to filing a settlement application in March this year, Motilal Oswal Financial Services filed revised settlement terms, which was approved by the markets watchdog.

Under the terms, MOFSL paid Rs 34.85 lakh to the regulator, which was confirmed by SEBI on Sept.17.

SEBI stated that the proceedings initiated through the show cause notice stand disposed of in terms of the settlement.

The regulator, however, clarified that it retains the right to act if representations made by the company are later found untrue, or if there is any breach of the settlement terms.

(With PTI inputs)