BSE too expels Karvy Stock Broking, says investors can seek help

Hyderabad: A day after the National Stock Exchange (NSE) expelled scam-tainted

Karvy

Stock Broking Ltd (KSBL) and declared it a defaulter, the Bombay Stock Exchange has followed suit.

In a circular issued late Tuesday night, BSE said it has also expelled KSBL and declared it defaulter with effect from November 24, 2020.

BSE also advised investors with outstanding claims against KSBL to file their claims with the exchange within 90 days from the issue of notice, which is February 22, 2021, to be considered eligible for compensation of up to Rs 15 lakh from the Investor Protection Fund (IPF) as per Sebi norms.

“The eligible claims filed before the end of aforesaid specified period would be considered for compensation from the IPF...to the maximum extent of Rs15 lakh per client,” BSE said in its circular.

BSE said investors can either file their claims at its concerned regional investor centres or through its website under e-complaint registration.

Sebi too issued a confirmatory order on Tuesday stating that KSBL, through its actions relating to Sebi’s ex parte order issued in November 2019, had accepted its wrong doings as it did not take the opportunity to present its case, including through a personal hearing with Sebi officials.

Sebi’s order stated that on the eve of each hearing date, KSBL sought adjournment citing reasons such as “Covid-19 pandemic, heavy rains in Telangana, sickness of its chairman, sickness of the buyer, etc.”

KSBL had, over several years, transferred the securities of its clients into its own demat account without their permission and illegally pledged them to raise funds that were eventually diverted to group companies like Karvy Realty.