SEBI increases informants' reward up to 10 crore to restrict possible insider trading

In a move to further restrict insider trading regulations, market watchdog Sebi on Tuesday decided to increase the reward amount for informants to a maximum of Rs 10 crore. The regulator's board approved the amendments to the Sebi (Prohibition of Insider Trading) Regulations, 2015 in Tuesday's board meeting. The decision has been taken under the prohibition of insider trading regulations to enhance the quantum of reward under the informant mechanism.

Under the new system, the reward has increased from Rs 1 crore to Rs 10 crore. 

"If the total reward payable to the informant is less than or equal to Rupees One Crore, then the reward may be granted by Sebi after the final order is issued," Sebi said in a release after the board meeting.

The watchdog issued a release stating if the total reward payable to the informant is more than Rs 1 crore, then an interim reward not exceeding Rs 1 crore could be granted by Sebi after the final order is issued.

The Sebi further noted that the reward of more than 1 crore will be granted only upon receipt of the monetary sanctions amounting to at least twice the balance of the reward amount payable by Sebi. The steps have been taken to minimize the possible insider trading activities in the stock market.

Sebi gives more time to brokers, clearing members to comply with rules

Meanwhile, Sebi on Wednesday extended deadlines for complying with certain regulatory requirements by stockbrokers, clearing members and KYC registration agencies in view of the ongoing COVID-19 pandemic, news agency PTI reported.

The deadline for maintaining call recordings of orders or instructions received from clients has been extended by one month till July 31, the Securities and Exchange Board of India (Sebi) said in a circular.

Also, the regulator has given time till July-end to brokers for operating the trading terminals from designated alternate locations.  Further, the deadline has been extended till July-end for submission of client funding report.

With regard to the issue of annual global statement to clients, Sebi has given relaxation till July 31. This will be applicable only if the client has requested for a physical statement. Earlier these relaxation were given till June 30.

(With inputs from PTI)