Sebi fines IIFL Securities, 5 Paisa Capital for lapses related to UCC database

New Delhi, Jul 30 (PTI) Capital markets regulator Sebi on Tuesday penalised IIFL Securities and 5 Paisa Capital for failing to correctly upload details in UCC (Unique Client Code) database.

The regulator levied a fine of Rs 3 lakh on IIFL Securities and Rs 2 lakh on 5 Paisa Capital in the matter, according to separate orders passed by Sebi.

The two broking firms did not act with proper skill, care, and diligence in their business because they failed to correctly upload details in the UCC database. This mistake included incorrectly listing 18 clients as Sikkim domiciled by IIFL Securities and 22 clients by 5 Paisa Capital, Sebi said.

This could have led to violations of the Stamp Duty Act and misuse of stamp duty exemptions meant only for Sikkim clients, it added.

"Noticee (IIFL Securities) has not acted with due skill, care and diligence in the conduct of its business, as it had not ensured correct uploading of the details in the UCC database, including 18 clients which were incorrectly considered as Sikkim domiciled," Sebi said.

For 5 Paisa Capital, Sebi said it " had not ensured correct uploading of the details in the UCC database, including 22 clients which were incorrectly considered as Sikkim domicile".

Through such acts, the two entities have violated the code of conduct specified under the broker's rule.

The Securities and Exchange Board of India (Sebi) conducted examination of the two entities with respect to their role in uploading mismatch/wrong Unique Client Code (UCC) data of clients in the Multi Commodity Exchange of India Ltd (MCX) platform including Sikkim-based clients for the period beginning from July 1, 2020 till June 30, 2022. PTI SP MR