Sebi cancels merchant banking licence of Karvy Investor Services for non-compliance
During an on-site inspection at Karvy Investor’s registered office in March last year, the regulator found inadequate infrastructure concerning office space, equipment, and manpower to effectively discharge the activities.
MUMBAI - The Securities and Exchange Board of India () has cancelled the certificate of registration of Karvy Investor Services with immediate effect for non-compliance with regulations.The market regulator found that Karvy was not complying with the eligibility criteria laid down in the regulations, and has also not paid the renewal fees.
“Noticee (Karvy Investor Services) has not complied with the conditions subject to which the certificate of registration as Merchant Banker has been granted to it. In this regard, I note that an intermediary not complying with the conditions subject to which a certificate of registration has been granted to it is liable for action,” G Ramar, quasi-judicial authority at Sebi said in the order.
The holding company – Karvy Stock Broking – is involved in litigation which has an adverse bearing on the business of Karvy Investor Services, and hence, the firm is no longer a fit and proper person.
Based on this observation, Sebi had initiated enquiry proceedings against the merchant banker for alleged violations of regulations.
In September last year, a show-cause notice was issued to Karvy Investor Services, but there was no response on the same.
Based on the enquiries and the findings, Sebi found violations by the merchant banker, and has, therefore, cancelled the licence.
Source: Stocks-Markets-Economic Times
