The National Stock Exchange (NSE) on June 13, 2023, issued a notification regarding the Administrative actions for misuse of client funds.
The following has been stated namely: -
• To initiate immediate actions in critical cases where misuse of client funds is observed, the following administrative actions shall be taken by the Exchange.
1. Misuse of client funds in any of the Principles of Enhanced Supervision –
a. The proprietary deposits/collaterals of the Trading Member available with NCL shall be blocked to the extent of the shortfall/misuse amount or Rs.10 crores, whichever is lower.
b. In case misuse is observed in all principles, the amount equivalent to an aggregate amount of all principles, shall be blocked.
c. Proprietary deposits/collaterals shall be blocked after 2 trading days from the date of communication of the direction regarding the blocking of such deposits/collaterals to the Trading Member.
d. Such deposits/collaterals shall be blocked for a period of 10 days.
e. No exposure will be granted to the Trading member on such deposits/collaterals.
This circular shall come into effect from September 01, 2023.
[Notification No. NSE/INSP/57097]
