The markets regulator said unregistered online platforms were offering unlisted debt securities to investors. “Such platforms provide opportunities for investors to acquire unlisted debt securities. These platforms are not subject to any regulatory or supervisory oversight, and do not have primary investor protection or redressal of investor grievances.” The mechanism is lacking,” SEBI said in a statement.
Activities carried out by unregistered online platforms or issuers of unlisted debt securities under the Companies Act, 2013, SEBI Act, 1992, SEBI (Prohibition of Frauds and Unfair Trade Practices Relating to Securities Market) Regulations, in violation of SEBIssIue (2003). and List of Unconverted Securities) Regulations, 2021.
The violation occurs because the offer of unlisted securities to more than 200 investors is “deemed to be a public issue” under the Companies Act 2014. These activities may result in legal, regulatory or enforcement action against those involved in such activities.
SEBI recommended investors not to engage with such platforms. Recently, SEBI issued an interim order against certain entities operating such unregistered platforms.
“Investors should consider using online bond platforms operated by SEBI-registered stock brokers to invest in debt securities listed on the Bombay Stock Exchange (BSE) and/or the National Stock Exchange (NSE). Act as Online Bond Platform Providers (OBPPs) for Kari, the markets regulator urged.
SEBI is issuing this caution, advising investors not to engage in investment or trading activities through unregistered intermediaries, web applications, platforms and apps.
The regulator also said that these platforms are neither authorized nor recognised, and investors involved in such activities would not be entitled to necessary safeguards, such as investor protection under the jurisdiction of SEBI or stock exchanges. Access to grievance redressal mechanisms and dispute resolution administered by the Exchange. Services offered by authorized bodies.