Sebi to provide greater clarity to justify quantum of fines

To ensure greater transparency, market regulator Sebi has started providing additional clarity in its

RELATED ARTICLES

orders to justify the quantum of penalties imposed for defaults and other violations.

Sebi, which can levy penalties of up to Rs 25 crore or three times any ill-gotten gains (whichever is higher), has decided that its adjudicating officers would clearly mention the mitigating factors in their orders to justify the fines they impose for violation of norms, official sources said.

The decision was taken as part of efforts to streamline the interpretation of the monetary penalty provisions under securities laws. Besides, opinions given by the Attorney General on this issue were also taken into account.

Sebi's decision follows instances where the Securities Appellate Tribunal (SAT) had asked the regulator to justify the quantum of penalty imposed. There have been cases when SAT has set aside or modified the penalty imposed by Sebi and the move is helped at improving the chances of a penalty standing legal scrutiny.

Besides, it would help bring in greater transparency in the enforcement actions of the capital markets regulator.

The Securities and Exchange Board of India (Sebi) can impose penalties for failure to furnish information, fraudulent and unfair trade practices, and defaults.

In most cases, the penalty is Rs 1 lakh for each day of failure, subject to a maximum of Rs 1 crore. For insider trading, the fine can go up to Rs 25 crore.

Post new comment

E-mail ID will not be published
CAPTCHA
This question is for testing whether you are a human visitor and to prevent automated spam submissions.

EDITORIAL OF THE DAY

  • Signalling good times, current account deficit is likely to grow from here on

    The current account deficit (CAD) numbers for April-June quarter declined sharply to 1.7 per cent of GDP.

FC NEWSLETTER

Stay informed on our latest news!

INTERVIEWS

GV Nageswara Rao

MD & CEO, IDBI Federal Life

Timothy Moe

Goldman Sachs

Chander Mohan Sethi

CMD, Reckitt Benckiser India

COLUMNIST

Arun Nigavekar

Disruptive innovation in education

The past two weeks had a fair share of interesting ...

Rajgopal Nidamboor

Regain the spirit of focused power

For aeons, the human race has been experimenting with a ...

Gautam Gupta

Manufacturing must keep workers’ welfare in mind

It may be early days yet, but the labour reforms ...

INTERVIEWS

William D. Green

Chairman & CEO, Accenture