SEBI likely to penalise bourses for technical glitches

NEW DELHI:  Market regulator Securities and Exchanges Board of India (SEBI) is considering heavy penalties on the management of stock exchanges in the case of any technical glitch. “The Board (SEBI) is considering heavy penalties for management of exchanges for any technical glitch to prevent such things from happening in the future,” a senior official said.  

The National Stock Exchange had faced a technical glitch on February 24, causing monetary losses to several investors. Later, an enquiry was ordered into the event and even Finance minister  Nirmala Sitharaman had pointed out that the stoppage of trading, a result of the glitch, had been a serious embarrassment.

Earlier, SEBI imposed penalties of `12 lakh and `6 lakh on CPR Capital Services Ltd and PRB Securities Pvt Ltd, respectively for multiple violations with respect to using National Stock Exchange (NSE)’s co-location (Colo) facility. Meanwhile, Thursday also saw SEBI announcing a new disclosure framework for mutual funds focused on cutting down the information overload on investors.

According to the regulator, mutual funds will have to make a disclosure about the scheme’s risk-o-meter, performance, and portfolio details to investors only for plans in which they have invested. This is aimed at enhancing the quality of disclosure with respect to risk and performance, and portfolio of the schemes, without creating information overload, SEBI said. The new framework will be applicable with effect from June 1, 2021, the regulator pointed out.