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The order comes after Securities and Exchange Board of India (Sebi) conducted a comprehensive inspection of Motilal Oswal Financial Services with respect to its stock broking and depository participants’ activities from August 2019 to September 2019.
In addition, it has been charged for funding clients beyond the stipulated time period, failure to keep appropriate evidences of client order placement and discrepancies in CKYC (Central Know Your Customer) process among others, according to a Sebi order passed on Friday.
The order comes after Securities and Exchange Board of India (Sebi) conducted a comprehensive inspection of Motilal Oswal NSE -0.36 %. Financial Services with respect to its stock broking and depository participants’ activities from August 2019 to September 2019.
The period covered in the inspection was from April 2018 to August 2019.
In its order, Sebi found that Motilal Oswal Financial Services incorrectly reported margin to the exchange in the F&O segment whether there was a shortfall in case of three clients. Further, it had given exposure to few clients beyond T+2+5 days.
Also, the stock broker had not uploaded CKYC details of clients on the CERSAI (Central Registry of Securitisation Asset Reconstruction and Security Interest of India) portal. While it has rectified the lapses post the inspection, during the inspection period there was non-compliance which has not been denied by Motilal Oswal Financial Services.
“As a Sebi-registered intermediary, noticee was under a statutory obligation to abide by the provisions of the SCRA & Sebi Act, which it failed to do. Such disregard for the provisions of law governing the functioning of such intermediaries calls for an appropriate penalty which should act as a deterrent,” Sebi said.
Through such acts, Motilal Oswal Financial Services has violated regulatory norms and accordingly Sebi levied a fine on it.
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