{"id":106112,"date":"2023-08-03T15:39:04","date_gmt":"2023-08-03T10:09:04","guid":{"rendered":"https:\/\/tradebrains.in\/features\/?p=106112"},"modified":"2023-08-03T15:39:06","modified_gmt":"2023-08-03T10:09:06","slug":"in-the-nsel-case-sebi-cancels-the-registration-of-mmtc","status":"publish","type":"post","link":"https:\/\/tradebrains.in\/features\/in-the-nsel-case-sebi-cancels-the-registration-of-mmtc\/","title":{"rendered":"In the NSEL case, Sebi cancels the registration of MMTC."},"content":{"rendered":"<div class=\"trade-content_2\" style=\"margin-left: auto;margin-right: auto;text-align: center;\" id=\"trade-3530233971\"><p><a href=\"https:\/\/tradebrains.in\/get\/telegram\/\"><img decoding=\"async\" class=\"alignnone wp-image-101992\" src=\"https:\/\/tradebrains.in\/features\/wp-content\/uploads\/2023\/01\/telegram-channel-300x119.png\" alt=\"\" width=\"148\" height=\"59\" \/><\/a> <a href=\"https:\/\/news.google.com\/publications\/CAAqBwgKMN3Epgswxc--Aw?hl=en-IN&amp;gl=IN&amp;ceid=IN%3Aen\"><img decoding=\"async\" class=\"alignnone wp-image-123430\" src=\"https:\/\/tradebrains.in\/features\/wp-content\/uploads\/2024\/05\/follow-on-google-news-300x82.png\" alt=\"follow-on-google-news\" width=\"222\" height=\"61\" srcset=\"https:\/\/tradebrains.in\/features\/wp-content\/uploads\/2024\/05\/follow-on-google-news-300x82.png 300w, https:\/\/tradebrains.in\/features\/wp-content\/uploads\/2024\/05\/follow-on-google-news-150x41.png 150w, https:\/\/tradebrains.in\/features\/wp-content\/uploads\/2024\/05\/follow-on-google-news.png 468w\" sizes=\"(max-width: 222px) 100vw, 222px\" \/><\/a><\/p>\n<\/div><p>Capital markets regulator Sebi has cancelled the registration of MMTC Ltd as a stockbroker for its involvement in illegal &#8220;paired contracts&#8221; in a case pertaining to the now-defunct National Spot Exchange Ltd (NSEL).<\/p><div class=\"trade-content_7\" style=\"margin-left: auto;margin-right: auto;text-align: center;\" id=\"trade-1474905207\"><!-- Composite Start --> \r\n <div id=\"M923760ScriptRootC1549812\"> \r\n <\/div> \r\n <script src=\"https:\/\/jsc.mgid.com\/t\/r\/tradebrains.in.1549812.js\" async> \r\n <\/script> \r\n <!-- Composite End --><\/div><p>While cancelling the licence, Sebi directed MMTC to allow its existing clients to withdraw or transfer their securities or funds held by it within 15 days.<\/p><p>In case a client fails to do so, the broker will transfer the funds and securities of such clients to another registered broker in the next 15 days under advice to the said clients, Sebi said in its order on Wednesday.<\/p><p>Going by the order, MMTC is a commodity derivatives broker registered with Sebi, since December 2015 and is currently a member of the Multi Commodity Exchange of India Ltd (MCX).<\/p><div class=\"trade-content_5\" id=\"trade-1254436831\"><script async src=\"https:\/\/pagead2.googlesyndication.com\/pagead\/js\/adsbygoogle.js?client=ca-pub-4023722985638610\"\r\n     crossorigin=\"anonymous\"><\/script>\r\n<!-- in_content_2_news -->\r\n<ins class=\"adsbygoogle\"\r\n     style=\"display:block\"\r\n     data-ad-client=\"ca-pub-4023722985638610\"\r\n     data-ad-slot=\"7925020301\"\r\n     data-ad-format=\"auto\"\r\n     data-full-width-responsive=\"true\"><\/ins>\r\n<script>\r\n     (adsbygoogle = window.adsbygoogle || []).push({});\r\n<\/script><\/div><p>The broker made an application in September 2019 to surrender its membership in MCX. However, the surrender application of MMTC is still pending with MCX.<\/p><p>In its order, Sebi said MMTC traded in &#8220;paired contracts&#8221;, which did not have regulatory approval.<\/p><p>&#8220;The notice (MMTC) having traded in the &#8216;paired contracts&#8217; on the NSEL, which was in violation of the conditions of the 2007 Exemption Notification and also the provisions of the Foreign Contribution Regulation Act (FCRA), seriously calls into question the integrity, honesty and lack of ethical behaviour on its part,&#8221; Sebi said.<\/p><p>By doing so, the stockbroker failed to meet the &#8220;fit and proper&#8221; criteria mentioned in the intermediaries&#8217; rules and accordingly, Sebi has cancelled &#8220;the certificate of registration of the notice (MMTC Ltd)&#8221;, it said.<\/p><p>In September 2009, NSEL introduced the concept of &#8220;paired contracts&#8221; for trading, which allowed buying and selling of the same commodity through two different contracts at two different prices on the exchange platform, wherein the investors could buy a short-duration contract and sell a long duration contract and vice-versa at the same time at a pre-determined price.<\/p><p>The trades for the buy contract and the sell contract used to happen on the NSEL on the same day at the same time but at different prices, involving the same counterparties. The transactions were structured in a manner that buyers of the short duration contract always ended up making profits.<\/p><div class=\"trade-content-10\" id=\"trade-4267816454\"><script async src=\"https:\/\/pagead2.googlesyndication.com\/pagead\/js\/adsbygoogle.js?client=ca-pub-4023722985638610\"\r\n     crossorigin=\"anonymous\"><\/script>\r\n<!-- in_content_3_news -->\r\n<ins class=\"adsbygoogle\"\r\n     style=\"display:block\"\r\n     data-ad-client=\"ca-pub-4023722985638610\"\r\n     data-ad-slot=\"2969612066\"\r\n     data-ad-format=\"auto\"\r\n     data-full-width-responsive=\"true\"><\/ins>\r\n<script>\r\n     (adsbygoogle = window.adsbygoogle || []).push({});\r\n<\/script><\/div><p>The scheme of &#8220;paired contracts&#8221; traded on the NSEL had caused huge losses to investors to the extent of Rs 5,500 crore.<\/p><div class=\"trade-after-content\" id=\"trade-3110145472\"><div id=\"taboola-below-article-thumbnails\"><\/div>\r\n<script type=\"text\/javascript\">\r\n  window._taboola = window._taboola || [];\r\n  _taboola.push({\r\n    mode: 'alternating-thumbnails-a',\r\n    container: 'taboola-below-article-thumbnails',\r\n    placement: 'Below Article Thumbnails',\r\n    target_type: 'mix'\r\n  });\r\n<\/script>\r\n<script type=\"text\/javascript\">\r\n  window._taboola = window._taboola || [];\r\n  _taboola.push({flush: true});\r\n<\/script><\/div>","protected":false},"excerpt":{"rendered":"<p>Capital markets regulator Sebi has cancelled the registration of MMTC Ltd as a stockbroker for its involvement in illegal &#8220;paired contracts&#8221; in a case pertaining to the now-defunct National Spot Exchange Ltd (NSEL). While cancelling the licence, Sebi directed MMTC to allow its existing clients to withdraw or transfer their securities or funds held by [&hellip;]<\/p>\n","protected":false},"author":5,"featured_media":94946,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_et_pb_use_builder":"","_et_pb_old_content":"","_et_gb_content_width":"","footnotes":""},"categories":[1696,31],"tags":[],"class_list":["post-106112","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-corporate-action","category-news"],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v20.5 (Yoast SEO v25.0) - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>In the NSEL case, Sebi cancels the registration of MMTC. - Trade Brains Features<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/tradebrains.in\/features\/in-the-nsel-case-sebi-cancels-the-registration-of-mmtc\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"In the NSEL case, Sebi cancels the registration of MMTC.\" \/>\n<meta property=\"og:description\" content=\"Capital markets regulator Sebi has cancelled the registration of MMTC Ltd as a stockbroker for its involvement in illegal &#8220;paired contracts&#8221; in a case pertaining to the now-defunct National Spot Exchange Ltd (NSEL). 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