Sebi penalises SMC Global Securities for compliance lapses

Capital market regulator Sebi has levied a Rs 1 lakh fine on city-based SMC Global Securities for failing to comply with norms on maintaining client order-placement records and supervision of an authorised person.

The order came after the Securities and Exchange Board of India (Sebi) conducted a thematic inspection of the stock broker for the period January-September 2024, focusing on unauthorised trading complaints and client order placement.

The market watchdog found that SMC Global Securities had not maintained appropriate pre-order placement records for certain clients and could not provide relevant records for multiple orders, Sebi said in an order passed on Thursday.

Sebi also found deficiencies in the broker's supervision of authorised person Amit Lilhare, including failure to adequately monitor bank accounts receiving commissions and verify payout requests from clients.

The order said that 161 of 343 active clients mapped to Lilhare showed a pattern of fixed payouts, involving client investments of Rs 6.11 crore and payouts of over Rs 1.84 crore during the inspection period.

Accordingly, SMC Global Securities flouted the Stock Brokers Regulations and other market norms.

SMC Global Securities is a Sebi-registered stock broker and a member of exchanges such as BSE, NSE, MCX and NCDEX.