InvestorQ : What happens to Karvy now that the company has been expelled from the stock exchange by the NSE?
Riya Dwivedi made post

What happens to Karvy now that the company has been expelled from the stock exchange by the NSE?

Answer
image
shrinidhi Rajan answered.
7 months ago
Follow

On 23 November, the NSE declared Karvy Stock Broking as defaulter for non-compliance with the regulatory provisions and expelled the company from the primary membership of the stock exchange. Most likely, BSE and the MCX would also follow suit.

The case dates back to Nov-19 when Karvy had transferred client shares to group companies of Karvy in an unauthorised manner by misusing the power of attorney. In late 2019, SEBI had already barred Karvy from adding fresh brokerage clients for allegedly defrauding broking clients worth Rs.2000 crore.

After the payout of Rs.2300 crore, there are outstanding dues of Rs.1200 crore to clients; equivalent to the amount held by exchanges in IPF. It is not clear what happens to the client dues, but an expulsion almost means end of the road for its capital markets business.

3 Views