 "The logo of the Securities and Exchange Board of India (SEBI), India's market regulator, is seen on the facade of its head office building in Mumbai")
The Securities and Exchange Board of India (Sebi) on Monday issued a warning to stock broking firm Motilal Oswal Securities in the matter of Pyramid Saimira case, a market manipulation case. The regulator found that the firm had execute trades of some debarred entities. Sebi warned the broker of stringent action for any future lapse.
Passing an order, Sebi said that the brokerage firm has already been slapped with a monetary penalty of Rs 75,000 by BSE for the same lapses, while it has also taken "corrective steps" in this matter.
Motilal Oswal Securities had executed trades on behalf of three debarred clients -- Shailesh Jayantilal Shah, Rajesh Jayantilal Shah and Ritaben Rohitkumar Shah. These clients were restrained from the securities market in April 2009.
In the order passed by Whole time Member S Raman, Sebi said that "being a registered stock broking firm, having a diversified client base and a group net worth of Rs 5.58 billion (as on March 31, 2012), the noticee ought to have put in place adequate systems to avoid such mistakes.”
It took note of the firm having taken corrective steps like deactivating the trading accounts of the concerned clients, withholding the proceeds of sale transactions, passing appropriate entries in the books of the clients, and stopping payout in respect of the said trades.
