Mumbai: BSE (Bombay Stock Exchange) shares fell by over 1 percent on Thursday morning after SEBI (Securities and Exchange Board of India) imposed a Rs 25 lakh penalty on the exchange. SEBI found that BSE did not follow some important rules meant to keep the market fair and transparent.
Share Price Drops After Flat Start
BSE shares started flat but soon declined. The stock fell by 1.47 percent to Rs 2,748 on the NSE. Investors reacted to SEBI’s order, which was made public on Wednesday.
SEBI Imposes ₹25 Lakh Penalty On BSE For Breach Of Norms
What SEBI Found in Its Inspection
SEBI’s order came after an inspection of BSE’s systems between February 2021 and September 2022. The regulator found serious issues with how BSE handled corporate announcements and broker activity.
SEBI said BSE’s internal systems allowed some of its paid clients and its own internal team to see corporate news before it was made public on the website. This gave unfair advantage to a few and broke market rules.
The inspection also showed that BSE did not have proper checks to ensure everyone received the same information at the same time. This lack of fairness can harm trust in the market.
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SEBI stated that BSE broke Regulation 39(3) of the SECC Regulations, 2018. This rule says stock exchanges must make sure all users get equal and fair access to important information.
BSE also failed to set up a simple RSS (Really Simple Syndication) feed that could have helped spread corporate news equally to all users. Although BSE later introduced a time delay system to fix the issue, SEBI pointed out that this happened only after the inspection.
Broker Oversight Was Weak
SEBI also raised concerns about how BSE handled trade modifications by brokers. Brokers can only change trade details for genuine reasons. But SEBI found BSE did not act against brokers who made frequent changes.
There were also issues with how BSE monitored 'error accounts' — special accounts used for correcting trade mistakes. SEBI said the exchange did not do enough to prevent misuse.
(With PTI Inputs)
