In a move to prevent misuse of unpaid client securities, the Securities and Exchange Board of India (Sebi) has issued new guidelines for brokers on the pay-out of such securities. The markets regulator has directed that all securities received in pay-out will have to be transferred to the client’s demat account within one working day from the pool account of trading or clearing members.
Shares that a client wants to buy are first transferred to the broker’s account from the clearing corporations. The day a buyer receives the shares from the broker is called the pay-out date.
The regulator has asked brokers to open a separate account titled client unpaid securities pledgee account to transfer unpaid securities. The securities that have not