Why SEBI revoked registration of 39 stock brokers
The Securities and Exchange Board of India (SEBI) has revoked the registration of 39 stock brokers and seven commodity brokers for failing to meet necessary requirements. The regulator also terminated the registration of 22 depository participants who are no longer affiliated with any depository. This action was taken to prevent these entities from misusing their SEBI registration without being an active participant in a recognized stock exchange or a depository.
Cancelation aimed at protecting investors
SEBI's decision to cancel these registrations is part of its efforts to protect unsuspecting investors. The entities whose registrations have been revoked are still accountable for their actions or inactions as stock brokers, commodity brokers, or depository participants. They are also required to settle any outstanding dues, fees, and interest owed to SEBI.
SEBI's conditions for broker registration
SEBI had initially granted registrations to these 39 stock brokers and seven commodity brokers under certain conditions, including continuous membership with a recognized stock exchange. However, these entities are no longer members of any stock exchange and therefore do not fulfill the requirements for holding a stock broker registration under the Broker Regulations 1992. This led to their expulsion as members by the stock exchanges and subsequent cancelation of their SEBI registrations.
SEBI terminates registration of 22 depository participants
In addition to stock and commodity brokers, SEBI also terminated the registration of 22 depository participants. These entities had their agreements with the depositories terminated and were no longer participants of any depositories. As a result, they did not meet the registration requirements under the DP Regulations 2018, leading to their deregistration following the method outlined in the Intermediaries Regulations 2008.
These are the firms with cancelled registrations
The 39 stock brokers with cancelled registrations include BSumpoorna Portfolio, Quantum Global Securities, Vineet Securities, Wellindia Securities, Amber Solutions, C.M. Goenka Stock Brokers, and Destiny Securities. Commodity brokers whose registrations were terminated include Wealth Mantra Commodities, Sumpoorna Comtrade, Chaitanya Commodities, Financial Leaders Commodities and Wellindia Commodities. Integrated Stock Broking Services, Moongipa Investments, Max Planwealth Securities, and Bright Shares and Stock are among the 22 firms whose registrations as depository participants were terminated.
