SEBI Action to Prevent Stock Brokers Fraud; Now fraud of investors will be stopped, SEBI has made full preparations, read in detail
SEBI will create a mechanism to curb fraud and market manipulation by stock brokers. Also, the regulatory framework to allow private equity funds to sponsor mutual fund companies has also been approved, corporate governance norms will be tightened and it has been decided to end the practice of permanent membership of people in listed companies.
Fraud of stock brokers will be curbed
SEBI will now implement a system of blocking funds in bank accounts for IPOs in the purchase and sale of shares already available in the stock market. The Board of Directors of Sebi, in its meeting on Wednesday, decided to introduce the facility of application (Application Supported by Blocked Amount) for investors having ‘block’ amount in their account for purchase and sale of shares available in the stock market.
SEBI’s tough stance on IPO approval, now companies have to do a lot of hard work
In this, the money of the investors who have applied for the issue remains in their account till the issue allocation situation is clarified while the amount is deducted from the account only after the IPO is received. In such a situation, this facility will now be optional for investors as well as stock brokers. And it aims to increase efficiency in the market environment. This will provide an opportunity to meet margin and settlement obligations, thereby requiring less working capital for members.
Fund will be blocked like IPO
In its statement, Sebi said that under the proposed framework, stockbrokers will be allowed to settle brokerage directly with UPI customers or opt for the clearing corporation’s facility to deduct the standard rate of brokerage from the customer’s UPI block. The system will be implemented in a phased manner to ensure a smooth transition to the market. The new facility will allow customers to earn interest on their ‘block’ amount till the balance in the savings account is exhausted.
