The Securities and Exchange Board of India (Sebi) has directed all the stock exchanges to scrupulously share information on defaulter broker-members who hold multiple cards.

The directive comes in the wake of recent complaints received by Sebi that exchanges do not intimate their peers if a stock broker is declared defaulter.

Sebi took a strong exception to the exchanges which failed in sharing information and directed that whenever a stock broker is declared defaulter by a bourse, the concerned stock exchange shall immediately inform other bourses about the default of the member.

If membership is held in the name of a corporate body, then the names of the promoters/dominant shareholders should also be intimated, Sebi said.

Further, if associates of a defaulter-broker are holding membership in other stock exchanges, then action, if any, required to be taken against such associate member(s), should be decided by respective stock exchanges after examining the relevant facts.

In this connection, Sebi also reiterated the directive of the government of India about defaulting members on stock exchanges.

According to the directive, if a particular stock exchange holds membership in other stock exchange(s) in his/its own name then such member(s) should be declared defaulter(s) in other stock exchange(s) also.

It is worth mentioning that several smaller exchanges have tied up with larger exchanges such as the National Stock Exchange and the Bombay Stock Exchange and the members of regional exchanges trade on these exchanges through a subsidiary company of the parent exchange or have multiple memberships in either individual or corporate capacities.