NEW DELHI: The Securities Appellate Tribunal (SAT) on Friday asked market regulator SEBI to decide by Monday whether any interim relief may be given to Karvy Stock Broking.
The regulator had banned Karvy from using its power of attorney to trade after it was discovered that it had indulged in unauthorized trades with clients’ money, misusing its PoA.
Sebi’s order, given last week, said Karvy had misused client securities by pledging them without any authorisation.
The total value of such transactions was believed to be over Rs 2,000 crore, making this one of the biggest misuses of PoAs. Sebi’s directive had come after the National Stock Exchange forwarded a preliminary report to it on the issue.
The brokerage had, however, sought relief from the order disallowing it from using PoAs, pointing out that the restrictions were making it difficult to honour demands from clients for pay-outs from authorized sales of their shares.
“Since a clarification has been sought by the appellant (Karvy) we deem it fit and proper that the WTM (whole-time member of Sebi) should look into this aspect and pass appropriate order after giving an opportunity of hearing to the appellant,” the tribunal said in an order.
It asked Sebi to “pass an appropriate order after giving an opportunity of hearing by December 2, 2019”.