Capital markets regulator Sebi on Monday put in place a new framework which will prevent misuse of clients’ securities and funds by their stock brokers.
Under the framework, depositories need to validate the transfer instruction for pay-in of securities from client demat accounts to trading member pool accounts against obligations received from the clearing corporations.
This should be done prior to executing actual transfer of the securities for pay-in from client demat account to trading member (TM) pool account, the Securities and Exchange Board of India (Sebi) said in a circular.
The framework, applicable from November 25, is aimed at further mitigating the risk for clients’ securities, especially those given towards delivery/settlement obligations.
“Depositories, prior to executing actual transfer of the securities for pay-in from client demat account to TM Pool account, shall validate the transfer instruction received through any of the available channels for the purpose of .
| Subscribe To Our Free Newsletter |
