The order came after the Securities and Exchange Board of India (Sebi) conducted an inspection of MDPL for the period from April 2021 to November 2022.
After the inspection, Sebi initiated the adjudication proceedings against Maheshwari Datamatics for violating the market rules.
In its order passed on December 29, Sebi found Radhey Shyam Jhanwar was an associate person of MDPL during the inspection period and hence was required to possess the National Institute of Securities Markets (NISM) certification.
Under the Sebi rules, the markets watchdog has laid down the specific procedural requirements regarding the certification of an associate person, and these requirements must be adhered to.
However, MDPL had failed to ensure that its associated person has completed the mandatory NISM certification, thereby violating the RTA rules.
“I note that penalties have been imposed by Sebi on the noticee earlier for similar violations. Such repetitive violations by the noticee show that it had not given sufficient attention to the deficiencies pointed out in the earlier inspections,” Sebi’s Adjudicating Officer N Hariharan said in the order. The regulator also found that there is no finding on record to show that the activities of the noticee have caused loss to any client or have impacted the securities market in any manner.
However, the regulator noted that there can be no dispute regarding delay in processing of requests by investors within the prescribed timelines which have affected the genuine rights of investors, as per Sebi.
In a separate order, the markets watchdog imposed a penalty of Rs 6 lakh on Capital Grow Financial Services (Proprietor Prashant Gole) for violating market rules.
The order came after the Securities Appellate Tribunal (SAT) in its ruling had set aside Sebi’s order passed in January 2023 and remitted the matter back to the regulator and directed it to pass a fresh order.
Capital Grow Financial Services is a Sebi-registered investment adviser.
