Over 370 transactions on bourses under lens

Intelligence agencies tracking financial fraud and money laundering are examining over 370 cases of suspicious transactions in Indian stock markets after they were reported by stock brokers to the Financial Intelligence Unit (FIU).

The government had made it mandatory for stock brokers to report all suspicious transactions to FIU to avoid any illegal money flowing into the market. So far, FIU has received 528 suspicious transaction reports (STR) which were analysed and 377 of them were referred to relevant agencies for further investigation. Till date, 528 STRs have been received from stock brokers, including depositary participants. In absence of a central database regarding action taken on STRs, it was not feasible to indicate the current status of each case.

Securities and Exchange Board of India (Sebi) had recently issued circulars to scrutinise market intermediaries, including stock brokers, advising them to put necessary systems and procedures in place for fulfilling their obligations under the Prevention of Money Laundering Act (PMLA). As per PMLA guidelines, the Principal Officer of a banking company or any financial institution shall have to furnish information to FIU in respect of suspicious transactions, not later than seven working days on being satisfied that the transaction was suspicious.