Stock exchanges up scrutiny of traders whose exposure exceeds income

NSE asks asked brokers to check for suspicious transactions as derivative activity surges

Exchange authorities have flagged a mismatch between the declared wealth and earnings of some traders and the exposure they have taken on the stock exchange.

A circular by the National Stock Exchange has asked brokers to check for suspicious transactions and ensure that the source of funding is clear. Meanwhile, some brokerage officials feel that more clarity on the degree of violations that should be reported may be needed to help address issues.

“…it has come to the notice of the Exchange that, pay-in/ pay-out obligations/ margin/ exposure for some clients are not consistent with the income level/ net worth