Markets watchdog Sebi today warned India Infoline Ltd to be 'careful and cautious' while carrying out stock broking activities but said any future lapse will attract stringent action.
A probe by Securities and Exchange Board of India (Sebi) found that India Infoline had executed trade on behalf of three debarred clients. These clients were barred from the securities market in April 2009.
India Infoline had failed to exercise due care and diligence to deactivate the clients account and thereby violated brokers' regulations.
According to Sebi, a monetary penalty of Rs 50,000 had already been imposed on India Infoline by the NSE in June 2009 for the same lapses.
Besides, after the occurrence of the impugned trades, India Infoline had taken several steps and process to further improve and strengthen its systems and avoid any future lapse on account of such technical issues.
India Infoline has exercised due care, skill and diligence to avoid any violation of the broker regulations in the past six years.
In an order passed today, Sebi said that the present "matter may be allowed to rest with a strong warning to the noticee for executing trades on behalf of the clients who were debarred by the ad-interim ex-parte order dated April 23, 2009."
Accordingly, Sebi has warned "the noticee, to be more careful and cautious in the conduct of its business and to adhere to and comply with all the statutory provisions while carrying out its activities in the securities market."
"Any future lapse on its part in complying with the said provisions shall invite stringent action," it added.
