SEBI vide circular dated April 11, 2022 has issued a Comprehensive Risk Management Framework for Electronic Gold Receipts (EGR) segment. The framework provides that where a member has reported falsely the margin collected from clients and the same is found out during inspections:
- The Stock Exchanges and Clearing Corporations, in all segments, in consultation with one another, shall devise a standard framework for imposition of fine on the TM/CM for incorrect/false reporting of margin collected from the clients.
- Considering the principle of ‘proportionality’, the fine shall be charged to the member based on the materiality of non-compliance done by the member which may include factors such as number of instances, repeated violations, etc. The amount of fine to be charged upon the member may extend to 100% of such false/incorrectly amount of margin and/or suspension of trading for appropriate number of days.
