Mumbai : The Securities and Exchange Board of India (SEBI) in its master circular on Tuesday directed market intermediaries to put in place an internal code of conduct and controls to deal with the increase in dissemination of unauthorized news by SEBI-registered market intermediaries. This comes after the regulator said that it has noticed that a lot of unverified stock related news was being circulated through blogs/chats, emails, forums by the employees of the broking house and other middlemen. The regulator said this is being done without due diligence as per the code of conduct for stock brokers and the relevant rules of various intermediaries registered with SEBI.
SEBI said that access to such blogs, chat forums and messengers should be restricted or allowed under surveillance. Market-related news that workers receive by email, blog, personal or official mail, or in any other way, should be instructed not to forward until it has been reviewed and approved by the intermediary’s compliance officer goes.
“This initiative of SEBI dates back to March 2011 when the regulator for the first time issued a circular acknowledging the issue and providing for taking action to prevent the spread of unauthorized news by market intermediaries. It is imperative for market intermediaries to ensure that a comprehensive code of conduct is put in place to prevent the spread of speculative and/or unauthorized information,” said Gaurav Mistry, legal partner, DSK.
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