DPs asked to tighten transfer norms

Mumbai: Issuing a new set of instructions on transfer of securities, the Securities and Exchange Board of India (Sebi) has asked the depository participants (DPs) - National Securities Depository (NSDL) and Central Securities Depository (CSDL) - to give more emphasis on investor education.

Sebi has asked DPs to counter check information on transactions with the investor if some unusual features are observed.

This comes after Sebi received complaints from investor forums that securities are transferred from the beneficial owner accounts (BO) without proper authorisation of the concerned investor. The Secondary Market Advisory Committee (SMAC) of Sebi studied the issue and has recommended a few safeguards.

The DPs have also been asked to put in place appropriate checks and balances with reverification of signatures of the investors while processing the slips. They would also be cross checking with the investors under exceptional circumstances.