Sebi Thursday refused to revoke ban on two brokers Ficus Securities and Ficus Commodities as well as their six former and present directors from securities markets after the regulator found them responsible for misuse of client funds.
Ficus Securities Pvt Ltd (FSPL) is a stock broker and Ficus Commodities Pvt Ltd (FCPL) is a commodity derivatives broker.
Among the six individuals, Vinod Kumar Bansal and Surender Singh are present directors of FSPL while Neena Bansal was its past director.
In the case of FCPL, Surender Singh is its present director, while Poonam Rajbhar, Tripta Kapoor and Shabnam John were its former directors.
Sebi, through a interim order in March 2018, had restrained both brokers and seven directors from accessing the securities markets "till further directions" and had directed them not to dispose of the assets without regulator's prior permission.
In a fresh order passed Thursday, the regulator said except Prashant Kumar Nayak, the present director of FCPL, all the entities "have not been able to make out a case for contradicting the findings of the interim order which would warrant revocation of the interim order".
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Accordingly, Sebi confirmed the directions issued via interim order against all the entities, except Nayak, and revoked the ban imposed on him.
In August 2017, the National Stock Exchange had forwarded an inspection report of FSPL to the markets regulator, which had made several adverse observations, including misuse of clients' funds and securities.
The regulator had observed that there were huge fund transfers between FSPL and FCPL which prima facie did not relate to trading.
Besides, the regulator found that funds belonging to investors were transferred from FSPL to FCPL.
Following this, Securities and Exchange Board of India (Sebi) had passed the interim order.