CDSL, Citibank NA settle regulatory violation cases with Sebi

Leading depository CDSL and global lender Citibank NA on Tuesday settled with Sebi cases pertaining to the alleged violation of regulatory norms after paying settlement charges.

CDSL and Citibank NA (DDP) paid Rs 1.3 crore and Rs 40.2 lakh, respectively, towards settlement charges, according to separate orders passed by Sebi.

The orders came after Central Depository Services (India) Limited or CDSL and Citibank NA filed applications with Sebi proposing to settle the instant proceedings initiated against them, "without admitting or denying the findings of facts and conclusions of law" through settlement orders.

In view of the acceptance of the settlement terms and the receipt of the settlement amount, the instant adjudication proceedings initiated against CDSL and Citibank NA through show cause notices dated November 13, 2023, and February 9, 2024, respectively, are disposed of, Sebi said in its orders.

With regards to the depository, the Securities and Exchange Board of India (Sebi) initiated adjudication proceedings against CDSL for the alleged violation of provisions related to the operational framework for transactions in defaulted debt securities post-maturity date/redemption date.

The regulator initiated adjudication proceedings against Citibank NA for the alleged violation of provisions of FPI (Foreign Portfolio Investors) rules and code of conduct specified under (Depositories and Participants) rules.

It was alleged that "Customer Acquisition Form appeared to have been regenerated by the implementation (IM) team and a member of the IM team had copied or replicated the end-client's wet-ink signatures, without the knowledge of the end client".