Description
SEBI imposed penalties on SMC Global Securities Limited for failing to maintain NSE CTCL terminals at reported locations during inspection period April 2023 to April 2024.
Summary
SEBI issued an adjudication order against SMC Global Securities Limited (Registration No. INZ000199438) following an inspection conducted on June 18-19, 2024. The inspection covered the period from April 1, 2023 to April 30, 2024 and revealed that 20 out of 262 NSE CTCL terminals were not found at their reported locations, violating exchange regulations and SEBI Stock Brokers Regulations.
Key Points
- SMC Global Securities failed to maintain 20 NSE CTCL terminals at locations reported to the exchange
- Inspection period covered April 1, 2023 to April 30, 2024
- Violations include NSE Exchange circulars, SEBI Stock Brokers Regulations, and commodity exchange requirements
- Show Cause Notice issued on January 13, 2025
- Adjudicating Officer appointed on April 2, 2025 under Section 15-I of SEBI Act
Regulatory Changes
No new regulatory changes introduced. Enforcement of existing regulations regarding terminal location reporting and maintenance requirements for stock brokers.
Compliance Requirements
- Stock brokers must ensure all trading terminals are maintained at locations reported to exchanges
- Accurate reporting of terminal locations to NSE, MCX, and NCDEX
- Compliance with NSE Exchange circular NSE/MEMB/7400 dated April 20, 2006
- Adherence to SEBI Stock Brokers Regulations, particularly Regulation 26(xix) and 9(b)
Important Dates
- Inspection Period: April 1, 2023 to April 30, 2024
- Physical Inspection: June 18-19, 2024
- SEBI Findings Communicated: September 11, 2024
- Noticee Response: September 23, 2024
- Show Cause Notice: January 13, 2025
- Adjudicating Officer Appointment: April 2, 2025
Impact Assessment
Medium impact on SMC Global Securities operations and reputation. The violation of terminal location requirements undermines market surveillance and regulatory oversight capabilities. This enforcement action reinforces the importance of accurate reporting and compliance with exchange regulations for all registered stock brokers. The case demonstrates SEBI’s commitment to ensuring proper market infrastructure maintenance and transparency in broker operations.
Impact Justification
Regulatory enforcement action against major broker for terminal compliance violations affecting market infrastructure