Thirty-four brokers have defaulted since March 2018, including three year-to-date, according to the data available on the National Stock Exchange’s website.
Broking industry sources say these defaults are mostly the result of misuse of client securities and funds by brokers earlier. Once the Securities and Exchange Board of India (Sebi) ushered in more stringent norms to curb such practices, these brokers were unable to comply and hence defaulted.
Here is a look at some of the norms Sebi plans to introduce in the near future to safeguard customer interests, and checks that customers need to run while selecting a broker.