Markets regulator Sebi has slapped a fine of Rs 15 lakh on Kelvin Fincap Ltd for failing to notify change in its directorate to BSE and making wrong disclosures regarding preferential allotment.
The regulator conducted an investigation into the scrip of Kelvin Fincap between November 2011 and May 2014 and found that the firm had not made prompt disclosure to BSE regarding change in its directorate and cessation of managing director.
Besides, it also made wrong disclosure with regard to names of initial preferential allottees.
Further, the company had allotted preferential shares to 58 allotees and had wrongly disclosed to BSE that the allotment was made to 49 allottees.
By doing so, Kelvin Fincap violated listing agreement and contravened provisions of Securities Contracts (Regulation) Act, Sebi noted.
Consequently, a penalty of Rs 15 lakh was levied on Kelvin Fincap, formerly known as Dahyabhai Sons Ltd.
In a separate order, Sebi slapped Rs 10 lakh fine on stock broker SKSE Securities Ltd for not complying with the regulator's circular which mandated stock brokers to carry out settlement of funds and securities of the clients at least once in a calendar quarter or month, depending on the preference of the client.
Sebi said that its circular issued in December 2009 was "to instill greater transparency and discipline in the dealings between the clients and the stock brokers, so as to avoid misuse of (a) client funds and securities and (b) running account authorisation, by stock brokers... However, I note that the Noticee failed to ensure compliance of regulatory requirements."