sebi: Sebi asks stockbrokers to disclose investor charter and compliant data on websites

NEW DELHI: Market regulator Sebi on Thursday asked stockbrokers to disclose the charter for investors as well as data on complaints they received on their websites.
The new guidelines will come into 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 an investor deals with, such as account opening, KYC and in-person verification, dematerialization process and complaint resolution, Sebi, in consultation with market participants , has prepared an investor charter for stock brokers.
This charter specified the rights of investors, the various activities of stockbrokers with time limits, the do’s and don’ts for investors, and the grievance redress mechanism.
In this regard, stock exchanges have been instructed to advise stockbrokers to bring the Investor’s Charter for Stockbrokers to the attention of their clients – existing and new – by disclosing the Investor’s Charter on their respective websites, by making them available at conspicuous places in the office, provide a copy of the charter as part of the account opening kit to clients, by e-mail or letter, etc.
Additionally, in an effort to bring transparency into the investor grievance redress mechanism, Sebi has required brokers to disclose on their respective websites, data on complaints received against them and their redress.
The data must be released no later than the 7th of the following month, Sebi said.
In addition, the regulator has also prescribed a format for the disclosure of complaint data on their websites.
Under the disclosure, brokers will have to disclose complaints received during the month, those carried over from the previous month, complaints pending for more than three months, complaints resolved and the average time to resolve a complaint, among others. .
Previously, Sebi had required custodians, share registrars and transfer agents (RTAs) and investment bankers to disclose the investor charter for a bunch of categories on their websites.
In addition, he had ordered exchanges, depositaries and clearing houses to disclose on their websites data on complaints received against them and their redress.
This came after regulator Sebi released the Investor Charter in November. This charter includes the rights and responsibilities of investors, as well as the do’s 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 safe market, and to obtain services in a prompt and efficient manner”.
Rights include obtaining fair and equitable treatment, expecting redress of investor grievances filed in SCORES within a limited time.
In addition, the market regulator has created a separate investor charter for market infrastructure institutions – exchanges, clearing houses and custodians.

Dolores W. Simon