Sebi cancels the registration of 4 securities brokers, 11 depository participants

Sebi (Securities and Exchange Board of India) on Monday canceled the registration of 11 depository participants, including Karvy Stock Broking Ltd. In a separate order, the market regulator also revoked the registration certificates of four other securities brokers.

Notwithstanding cancellation of the Certificate of Listing, the respective Dealers and Depositary Participants will continue to be liable for anything they have done or failed to do as Depositary Participant and will continue to be responsible for payment of fees and unpaid duties and interest, if any, due to Sebi.

Sebi said the instructions will come into effect with immediate effect. The four stockbrokers whose registrations have been canceled are KSBL Securities, Conard Securities, Anee Securities and Credential Stock Brokers.

Besides Karvy Stock Broking and Anugrah Stock & Broking, the entities deregistered as depositary participants are — Wellindia Securities, BRH Wealth Kreators, Fairwealth Securities, Vrise Securities, MK Chandan Broking (RTG Share Broking), KSBL Securities, Vineet Securities, Anee Securities, Sumpoorna Portfolio.

The main purpose of canceling the certificate of registration, as a depositary participant, is to prevent the misuse of their registration with Sebi, without being a participant of a depositary, by ignorant investors, a Sebi said.

Accordingly, dealers and depository participants will continue to be liable for any action brought or to be taken as if their registration had not been canceled and this order does not excuse them from any violation of securities laws committed by them in as registered depository participants.

The exchanges informed Sebi that the brokers were expelled from their membership by them and the same was communicated to them, the order mentioned. All four entities have ceased to meet registration requirements stipulated by broker regulations, Sebi said.

The registration of the depositary participants was canceled after the depositaries informed Sebi that the agreements between the depositaries and 11 entities had been terminated by them and the same had been communicated to them.

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Dolores W. Simon