Brokerage firm SVS Securities today settled a Sebi probe into alleged violations of broker regulations by paying over Rs 30 lakh as settlement charges.
The Securities and Exchange Board of India (Sebi), in March last year, had barred SVS Securities from dealing in capital markets for one year for failing to exercise due care and diligence as a stock broker with respect to transactions in shares of Harita Seating Systems.
The regulator found that SVS Securities had failed to exercise due skill, care and diligence regarding transactions executed by its sub-broker, Aquarian Share Broker Co., through it on behalf of certain related clients in Harita's shares.
Following Sebi's order, SVS Securities had approached Securities and Appellate Tribunal (SAT) against the directive.
Sebi had agreed to settle the matter on payment of Rs 27.19 lakh as settlement charges plus legal costs incurred by the regualtor towards proceedings pending before the Tribunal under its consent order mechanism.
Pursuant to this, SVS Securities remitted a sum of over Rs 30.73 lakh including Rs 3.54 lakh as legal fees towards the settlement charges.
Accordingly, Sebi has disposed of the adjudication proceedings initiated against SVS Securities.
However, Sebi said that enforcement actions, including commencing or reopening of the proceedings, could be initiated if any representation made by the brokerage house is found to be untrue.
Under the consent mechanism, entities can seek to settle cases with the regulator after payment of certain charges and other expenses without admission of guilt.
