Regulation 8 - Settlement terms - Securities and Exchange Board of India (Settlement of Administrative and Civil Proceedings) Regulations, 2014

CHAPTER IV TERMS OF SETTLEMENT Settlement terms. 8. (1) The settlement terms may include a settlement amount and/or non-monetary terms, in accordance with the guidelines specified in Schedule-II. (2) The non-monetary terms may include appropriate directions, such as: (a) Voluntary suspension of certificate of registration or closure of business for a specified period; (b) Removal from Management; (c) Direction in the nature of disgorgement, where it is possible to identify the investors who have incurred losses on account of the action or inaction of the applicant; (d) Debarment of certain individuals from acting as a partner or officer or director of an intermediary or as an officer or director of a company that has a class of securities regulated by the Board, for specified periods; (e) Cancellation of securities and reduction in share holding where the securities are issued fraudulently including cancellation of bonus shares received on such securities, if any, and re-imbursement of any dividends received, etc; (f) Voluntary lock-in of securities; (g) Implementation of enhanced policies and procedures to prevent future securities laws violations as well as direction to appoint or retain an independent consultant to review policies and procedures; (h) Direction to provide enhanced training and education to employees of intermediaries; (i) Directions relating to internal audit and reporting requirements; (j) Any other directions that may be issued by the Board under the securities laws in the interest of the investors. (3) The settlement amount, excluding the legal costs and disgorgement amount, shall be credited to the Consolidated Fund of India. [(4) The application fee referred to in sub-regulation (2) of regulation 3, the additional processing fee accompanying the application for condonation of delay as referred to in sub-regulation (2) of regulation 4 and the legal costs, if any, forming part of the settlement amount shall be credited to the Securities and Exchange Board of India General Fund.] 1 (5) The amount of ill-gotten profits made or losses avoided by the applicant that may be disgorged as part of the settlement terms, shall be credited to the Investor Protection and Education Fund of the Board. ********** 1 Substituted vide the Securities and Exchange Board of India (Settlement of Administrative and Civil Proceedings) (Amendment) Regulations,2017 w.e.f. 27.02.2017. Prior to substitution sub-regulation (4) read as under: (4) The legal costs, if any, forming part of the settlement amount shall be credited to the Securities and Exchange Board of India General Fund.