NOTICE
CSE/Notices/SEBI/2011/020
August 05,
2011
Trading members are hereby informed that the Exchange has received a Circular from SEBI vide Ref. No.CIR/MIRSD/15/2011, dated August 02, 2011 regarding SMS and E-mail alerts to investors by stock exchanges. The contents of the said Circular are reproduced hereunder for information of the trading members.
Quote: -
CIRCULAR
CIR/MIRSD/15/2011 August 02, 2011
To
All Recognized Stock Exchanges
Dear Sir/Madam,
Sub: SMS and E-mail alerts to
investors by stock exchanges
1. SEBI receives complaints from investors against stock brokers which include alleged unauthorized trading in their accounts. SEBI has taken steps in the past to address this issue.
2. As an additional measure, it has now been decided in consultation with the major stock exchanges and market participants that the stock exchanges shall send details of the transactions to the investors, by the end of trading day, through SMS and E-mail alerts. This would be subject to the following guidelines:
A. Applicability
These guidelines are applicable to equity - cash and derivative – segments of the stock exchanges.
B. Uploading of mobile number and E-mail
address by stock brokers
i. Stock exchanges shall provide a platform to stock brokers to upload the details of their clients, preferably, in sync with the UCC updation module.
ii. Stock brokers shall upload the details of clients, such as, name, mobile number, address for correspondence and E-mail address.
iii. Stock brokers shall ensure that the mobile numbers/E-mail addresses of their employees/sub-brokers/remisiers/authorized persons are not uploaded on behalf of clients.
iv. Stock Brokers shall ensure that separate mobile number/E-mail address is uploaded for each client. However, under exceptional circumstances, the stock broker may, at the specific written request of a client, upload the same mobile number/E-mail address for more than one client provided such clients belong to one family. ‘Family’ for this purpose would mean self, spouse, dependent children and dependent parents.
C. Verification
by the stock exchanges
After uploading of
details by the stock brokers, the stock exchanges shall take necessary steps to
verify the details by any mode as considered appropriate by them which may
include the following:
a. By way of sending
SMS and E-mail directly to the investors at the numbers/E-mail address uploaded
by the stock brokers.
b. By way of sending
letters to the address of the investors uploaded by the stock brokers.
D. Sending of
alerts by the stock exchanges
Upon receipt of
confirmation from the investors, the stock exchanges shall commence sending the
transaction details generated based on investors’ Permanent Account Number,
directly to them.
E. Handling of
discrepancies, if any.
If any discrepancy is
observed by the stock exchanges in the details uploaded by the stock brokers
including non-confirmation by investors, bounced E-mails, undelivered
SMS/letters, etc., the stock exchanges shall inform the respective stock
broker.
F. Meeting out
the expenses for providing SMS and E-mail alerts
The stock exchanges may use the amount set aside from the
listing fees for providing services to the investing public, as provided vide
SEBI communication dated SE/10118 dated October 12, 1992, to meet the expenses
for providing this facility.
G. Implementation
The stock exchanges
shall put in place necessary infrastructure and implement the SMS and E-mail
alert facility at the earliest and not later than four months from the date of
this circular.
3. Stock exchanges
are advised to :
a. issue necessary
instructions to bring the provisions of this Circular to the notice of their
constituents and also disseminate the same on their websites;
b. make amendments to
the relevant bye-laws, rules and regulations for the implementation of the
above, as deemed necessary, in coordination with other stock exchanges;
c. communicate to
SEBI, the status of the implementation of the provisions of this Circular in
the Monthly Development Report to SEBI;
d. develop the
monitoring mechanism through the system of half-yearly internal audit and
inspections; and
e. publicize widely
the availability of this facility for the awareness of the nvestors.
4. This Circular is
issued in exercise of powers conferred under Section 11 (1) of
the Securities and
Exchange Board of India Act, 1992 to protect the interests of investors in
securities and to promote the development of, and to regulate the securities
market and shall come into effect from the date of this Circular
5. This circular is
available on SEBI website at www.sebi.gov.in
under the categories “Legal
Framework” and “Circulars”.
Yours faithfully,
V S Sundaresan
Chief General Manager
022-26449200
sundaresanvs@sebi.gov.in
Unquote:
Trading
Members are requested to take note of the aforesaid guideline of SEBI and the
exact modalities shall be notified separately.
MAV Raju
DGM (HR & Admn.)