SAT upholds Sebi order against Triveni; reduces penalty

The Securities Appellate Tribunal today upheld Sebi 's order against Triveni Management Consultancy Services but has reduced the penalty imposed on the entity to Rs 50,000 from Rs 1.5000000.In June, this year Securities and Exchange Board of India (Sebi) has imposed the penalty on Triveni after noticing certain deficiencies in the functioning of the company with respect to Know Your Customers forms and agreements, prevention of money laundering compliances, among others.However SAT in its order today said "Deficiencies noticed in the impugned order are procedural deficiencies and do not involve any fraudulent action on the part of the appellant( Triveni)".SAT also noted that a penalty was already imposed upon Triveni's CEO Manish Mathur and fine on Triveni was slapped as "vicarious liability"."Accordingly, while upholding the decision of Sebi in imposing penalty on account of deficiencies noticed during the investigation period, we restrict the penalty at Rs 50,000/- instead of Rs 1,50,000," SAT said.Sebi had conducted an inspection of books of accounts, documents and other records of Triveni during 2009-2011.The inspection team had observed certain deficiencies in the functioning of the company with respect to Know Your Customers forms and agreements, prevention of money laundering compliances, margin collection and reporting in the derivative segment and irregularities in handling of funds/securities.