The matter emanated from an inspection of SCS which was centred on the due diligence exercised by it
The matter emanated from an inspection of SCS which was centred on the due diligence exercised by it
The Securities and Exchange Board of India (SEBI) has suspended the licence of Satellite Corporate Services Pvt. Ltd. (SCS), Registrar to Issues and Share Transfer Agent, for three months with immediate effect for ‘irregularities. ‘
“The findings of the enquiry report are indeed shocking and disturbing and show that the noticee (SCS) did not carry out its fiduciary responsibility to its clients. SCS has simply not been diligent enough and happily cut corners,” SEBI said in the order.
The matter emanated from an inspection of SCS which was centred on the due diligence exercised by it in the SME public issues of Amrapali Capital and Finance Services Ltd. and Ace Tours Worldwide Ltd. handled by it, and to verify whether proper processes and timelines were followed while carrying out routine tasks, namely, share transfer, transmission, issue of duplicate shares, dematerialisation, re-materialisation of securities.
In the order, Ashwini Bhatia, whole time member, SEBI said, “I note from the enquiry report that the Designated Authority (DA) recommended that the Certificate of Registration of the Noticee be suspended for a period of three (3) months. I also note from the records of SEBI that an administrative warning has been previously issued against the Noticee.”
“The Market Intermediaries Regulation and Supervision Department, SEBI, shall appoint an auditor, at the cost of SCS/Noticee, before restoration of the Noticee’s Certificate of Registration, and satisfy itself that SCS has fully complied with all relevant guidelines/ circular to carry out its business in the best interest of the securities market,” the order said.
“The audit must certify that the Noticee has systems and procedures in place in compliance of various rules and regulations administered by SEBI,” it added.
“Additionally, companies who are clients of SCS are directed to conduct their own independent due diligence/audit of the Noticee and satisfy themselves about the capabilities of SCS to continue RTA activities for them,” the order further said.
“Each client company of SCS shall confirm to the Market Intermediaries Regulation and Supervision Department, SEBI, in this regard,” it added.
