Sebi asks stock brokers to disclose investor charter, compliant data on websites

New Delhi: Markets regulator Sebi on Thursday asked stock brokers to disclose the investor charter along with data related to the complaints they have received on their websites. The new guidelines will take effect on January 1, 2022, the Securities and Exchange Board of India (Sebi) said in a circular.

In order to facilitate investor awareness of several activities that an investor deals with such as account opening, KYC and in-person verification, the paperless process and complaint resolution, Sebi, in consultation with market players , has prepared an investor charter for stock brokers.

This charter spelled out investor rights, various activities of securities dealers with deadlines, dos and don’ts for investors, and a grievance mechanism.

In this regard, the exchanges were urged to advise stockbrokers to carry the investor charter for stockbrokers to important places in the office, provide a copy of the charter as part of the opening kit from accounts to customers, by e-mails or letters, etc.

In addition, in order to ensure the transparency of the investor grievance mechanism, Sebi has requested that brokers disclose on their respective websites data on complaints received against them and related remedies.

The data must be released no later than the 7th of the following month, Sebi said.

In addition, the regulator also prescribed a format for the disclosure of complaint data on their websites.

Under the disclosure, brokers will be required to disclose complaints received during the month, those carried over from the previous month, complaints that have been pending for more than three months, complaints resolved and the average time taken to resolve a complaint, among other things. .

Previously, Sebi had asked custodians, registrar and share transfer agents (ATRs) and investment bankers to disclose the investor charter for a bunch of categories on their websites.

In addition, it had ordered exchanges, depositaries and clearing houses to disclose on their websites, data on complaints received against them and related appeals.

This came after regulator Sebi issued an investor charter in November. This charter includes the rights and responsibilities of investors, as well as the dos and don’ts of investing in the securities market.

The charter aims to protect “the interests of investors by enabling them to understand the risks involved and to invest in a fair, transparent and secure market, and to obtain services quickly and efficiently”.

The rights include obtaining fair and equitable treatment, pending redress of investor grievances filed in SCORES within a specified time frame.

In addition, the market regulator has created a separate investor charter for market infrastructure institutions – exchanges, clearing houses and custodians.

Dolores W. Simon