Sebi pulls up UTI Securities

The Securities and Exchange Board of India (Sebi) on Thursday warned UTI Securities of "stringent action" after going through a two-year inspection report (April 2001 to April 2003).

It held UTI Securities guilty of failing to adequately explain movement of shares between its own and its clients' accounts as well as of not fully implementing precautions to prevent insider trading by its employees.

"It was alleged that no written consent was obtained for payment of funds and holding of securities in the beneficiary account from clients maintaining running accounts. Besides, there were many scrips which were just lying in the member broker's beneficiary account," the order by Sebi member Madhukar read. Sebi dismissed UTI's contention that not all anti-insider trading regulations were applicable to brokers.