Description
SEBI imposes penalties on Motisons Shares Private Limited for violations of stock broker regulations, client fund handling, and compliance requirements during inspections from 2021-2024.
Summary
SEBI has issued an adjudication order against Motisons Shares Private Limited (SEBI Registration: INZ000191336) following joint inspections conducted with NSE and BSE during October 2022 and August 2024. The order addresses multiple violations of Securities Contracts Regulation Act 1956, SEBI Stock Broker Regulations 1992, and various SEBI circulars identified during inspection periods from April 2021 to June 2024.
Key Points
- Joint inspection conducted by SEBI with NSE and BSE from October 13-24, 2022
- Limited purpose inspection conducted during August 13-14, 2024
- Multiple violations identified across two inspection periods
- Entity provided replies to inspection findings on December 26, 2022 and September 19, 2024
- Post inspection analysis conducted by SEBI
Regulatory Changes
The order references violations of multiple regulatory provisions including:
- Section 23D of Securities Contracts Regulation Act, 1956
- SEBI Stock Broker Regulations, 1992 (various clauses)
- Multiple SEBI circulars from 1993 to 2022 regarding client fund handling, compliance requirements, and trading practices
Compliance Requirements
- Stock brokers must comply with client fund segregation requirements
- Adherence to SEBI circulars on market operations and client protection
- Proper maintenance of regulatory compliance as per SEBI Stock Broker Regulations
- Implementation of surveillance and compliance measures as specified in various SEBI circulars
Important Dates
- Inspection Period 1: April 1, 2021 to August 31, 2022
- Inspection Period 2: April 1, 2023 to June 30, 2024
- First inspection findings communicated: December 12, 2022
- Second inspection findings communicated: September 11, 2024
- Entity replies submitted: December 26, 2022 and September 19, 2024
Impact Assessment
This adjudication order demonstrates SEBI’s continued focus on stock broker compliance and client protection. The multiple violations across extended periods indicate systemic compliance issues that could impact client trust and market integrity. Other stock brokers should review their compliance frameworks to ensure adherence to similar regulatory requirements.
Impact Justification
Adjudication order against stock broker for multiple regulatory violations, relevant for broker compliance standards