Markets regulator SEBI on slapped a fine of Rs 5 lakh on SMC Global Securities Limited for not adhering to the code of conduct prescribed for a stockbroker while using NSE’s co-location facility.
A SEBI probe found that SMC Global Securities Limited had connected to the secondary or fall-back server. Seeing on several occasions without making a complaint to the National Stock Exchange (NSE) and despite the exchange’s reprimands.
The investigation, which focused on the role of SMC. He was a member of NSE and registered stockbroker. He found that it logged in to the secondary server repeatedly. Having its full knowledge that such conduct was not permitted, as informed by NSE several times.
“The only default on the part of the notice (SMC) is that it connected to the secondary server repeatedly. Without making a complaint to NSE. Despite reprimand from NSE,” SEBI said in its 31-page order.
According to SEBI, the charge against SMC was only the non-adherence to the code of conduct. There was no allegation of any market misconduct or abuse of the system.
Further, there was no allegation of the broker.He gained any advantage over other trading members by connecting to the secondary server as found in this case.
Final Words
The regulator said that SMC violated the code of conduct specified for stockbrokers. SEBI’s norms and imposed a penalty of Rs 5 lakh.
The code of conduct mandates that a stockbroker shall act with due skill. He shall have care and diligence in the conduct. As well as its business.Hence, SEBI imposed a fine on SMC Global Securities Limited.
