RBS paid Rs 60 lakh to settle 2004 market crash case: Sebi

Market regulator the Securities and Exchange Board of India (Sebi) today said it has settled a case against RBS Asia after the banking major remitted Rs 60 lakh as penalty in a case pertaining to the lender's alleged role in the market crash of May 17, 2004.

"...The applicant, without admitting or denying the charges, has remitted a sum of Rs 60 lakh towards settlement charges," the Sebi said in a statement.

RBS Asia, formerly known as ABN Amro Asia, was allegedly involved in various activities, including short selling of participatory notes, on the day of the stock market collapse.

The Hong Kong-based RBS Asia was among the top ten FIIs that had traded on May 17, 2004, when the market saw a huge fall following an impressive performance by the Left parties in the Lok Sabha elections.

"It is alleged that the applicant (RBS Asia) failed to exercise due diligence in respect of registration of clients, issued participatory notes without complying with the 'know your client' norms, undertook short sales which is not permitted to FIIs in two scrips and failed to provide client information to Sebi," the regulator said.

Even as the proceedings were on, RBS Asia proposed a settlement in February this year.

"The High Powered Advisory Committee, constituted by Sebi, recommended the case for settlement on payment of Rs 60 lakh towards settlement charges for settling the enforcement actions," the Sebi said.