Client collateral protection: brokers must maintain records, reconcile holdings and issue daily collateral utilization statements to clients. The circular requires brokers to ensure client collateral is used only to meet the respective client's margin requirements and pay-ins, maintain an audit trail of collateral receipt, client authorisations, deposits with exchanges/clearing corporations, returns, and crediting of corporate actions, and to reconcile these records periodically. Brokers must issue daily collateral utilization statements to clients with a breakdown by cash, FDRs, bank guarantees and securities. Exchanges must investigate complaints, inspect brokers, impose deterrent penalties for mis utilisation, amend bye laws, disseminate the provisions, and report implementation to the regulator.
Cases where this provision is explicitly mentioned in the judgment/order text; may not be exhaustive. To view the complete list of cases mentioning this section, Click here.
Provisions expressly mentioned in the judgment/order text.
Client collateral protection: brokers must maintain records, reconcile holdings and issue daily collateral utilization statements to clients.
The circular requires brokers to ensure client collateral is used only to meet the respective client's margin requirements and pay-ins, maintain an audit trail of collateral receipt, client authorisations, deposits with exchanges/clearing corporations, returns, and crediting of corporate actions, and to reconcile these records periodically. Brokers must issue daily collateral utilization statements to clients with a breakdown by cash, FDRs, bank guarantees and securities. Exchanges must investigate complaints, inspect brokers, impose deterrent penalties for mis utilisation, amend bye laws, disseminate the provisions, and report implementation to the regulator.
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