Nearly 2,000 demat A/Cs stand frozen; SEBI recovers some dues

PTI New Delhi | Updated on August 03, 2014 Published on August 03, 2014

The Securities and Exchange Board of India’s efforts to recover dues from various defaulters and fraudsters through attachment and other proceedings seem to have begun yielding results, as payments have begun to trickle in.

However, nearly 2,000 demat accounts of individuals and companies still stand frozen for violations of various securities laws and default in penalty payment under SEBI order, according to the data available with two depositories CDSL and NSDL.

More than 1,700 demat accounts have been frozen by Central Depository Services Ltd (CDSL) as on July 31, out of which nearly 400 have been frozen as part of SEBI’s attachment proceedings against entities which have defaulted on paying dues, including penalties imposed on them.

Besides, National Securities Depository Ltd (NSDL) has frozen the accounts of over 1,900 under SEBI order. Together, NSDL and CDSL maintain close to 2.2 crore accounts.

Securities like shares, debentures, bonds of investors are held in electronic form (demat form) by the depositories.

Meanwhile, SEBI’s attachment proceedings to recover penalties from several entities seem to be yielding results as the market regulator has been able to collect nearly Rs 7 crore from various defaulters in some cases recently.

Earlier this year, the Securities and Exchange Board of India (SEBI) began passing orders to defreeze the bank accounts and demat accounts of entities which made the payment of outstanding dues.

So far, the market watchdog has passed 19 such orders.

The capital market watchdog began initiating attachment proceedings against defaulters, including individuals and companies, in October last year as per the greater powers granted to it through an ordinance promulgated by the government.

Since then, SEBI has launched nearly 1,400 attachment proceedings for recovery of penalties imposed in as many as 393 cases. These proceedings involve attachment of bank accounts, movable and immovable properties, shares and debentures.

The markets regulator is looking to recover penalties aggregating nearly Rs 1,700 crore imposed on various entities.

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Published on August 03, 2014
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