In an effort to check the common irregularities being committed by the trading community more effectively, market regulator the Securities and Exchange Board of India (Sebi) today came out with a master circular that consolidates various rules for oversight on different market players.
Listing some of the common irregularities in "the stock brokers/trading members books", Sebi said the exchange and clearing houses should initiate "remedial, penal and disciplinary" action against erring parties.
The Sebi said 'in-person verification' of clients is not being done while opening accounts and clauses are being added in the broker-client agreements which are contrary to the norms prescribed by model agreements.
Some of the other irregularities that need to be curbed include issuance of contracts notes without any serial/Sebi registration numbers, non-maintenance of client databases or wrongly captured details therein, non-payment of appropriate stamp duty and deficiency in service to the clients.
The master circular consolidates and updates the regulations with regard to oversight and inspection of stock exchanges and clearing corporations.