NSE revises penalty structure for unauthorized trades


The National Stock Exchange of India vide notification dated 31 July, 2023 has amended the penalty structure for unauthorized trades. The penalty for unauthorized trades shall be determined by Investor Grievance Redressal Committee (IGRC)/Arbitration. Monetary Penalty per case shall be Rs.50,000/- or 3% of the admissible amount determined in the IGRC/Arbitration order/award, whichever is higher.

In addition to above penalty:

  1. Member will be debarred from taking new clients for a period of one month, in case 25%
    of all the complaints (not less than 05) placed before IGRC / Arbitration in the immediately
    preceding calendar quarter are determined by it to be unauthorized trading cases.
  2. Where the number of unauthorized trading cases as per the numbers indicated at (II a)
    persist for three consecutive quarters, the Member concerned will be debarred from
    taking new clients and Authorized Persons (APs) if any, for a period of three months.

The revised penalty structure shall be applicable for the cases in respect of trades executed from August 1, 2023, determined as unauthorized trades by the GRC order / Arbitration Award.

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