Sebi mulls settlement overhaul; plans fast-track route for cases up to Rs 10Lakhs
Sebi proposes reforms to simplify settlement processes, including a fast-track mechanism for cases up to Rs 10 lakh and removal of 20% additional charges.Summary
The Securities and Exchange Board of India (Sebi) has proposed overhauling its settlement framework to make enforcement proceedings simpler, faster, and more predictable. Key changes include scrapping a 20% additional settlement charge in multiple-proceeding cases and introducing a fast-track route for settlements involving amounts up to Rs 10 lakh. Under the new framework, such cases would bypass the High Powered Advisory Committee (HPAC) and proceed directly to a panel of Whole Time Members. The regulator also plans to link settlement amounts to minimum penalties under securities laws, using category-based multipliers. A study revealed that rejected or withdrawn settlements resulted in penalties averaging eight times lower than proposed settlements; the revised approach aims to reduce this ratio to four times while maintaining deterrence. The existing summary settlement process for specified violations will remain under the fast-track framework, with orders passed by the competent authority or Whole Time Members depending on pending proceedings.
(Source：The Hans India)