Members’ attention is drawn to para 34 of SEBI Master Circular No. SEBI/HO/MIRSD/MIRSD-PoD-1/P/CIR/2024/110 dated August 09, 2024 on "Prevention of Unauthorized Trading by Stock Brokers" wherein all brokers were directed to execute trades of clients only after keeping evidence of the client placing such order. The following modes have been prescribed for order placement by the Trading Members on behalf of clients: -
a. Physical record written & signed by client,
b. Telephone recording,
c. Email from authorized email id,
d. Log for internet transactions,
e. Record of SMS messages,
f. Any other legally verifiable record.
It has been observed that certain trading members initiate buy/sell order(s) on behalf of the clients and communicate to the clients through IVR (Interactive Voice Response) system. Such clients are asked to press a predefined number/ option during the said IVR call to obtain the confirmation of order placement. Few examples of such practices of sending recorded message through IVR system and seeking confirmation are listed below:
1. Buy 50 shares of XYZ Ltd. at Rs.200/-. If you wish to proceed with buying, Press 1.
2. There is a credit balance of Rs.1,00,000/- in your account with us. Select Option/Press 1 to buy liquid bees of the said amount.
3. You may sell liquid bees held in your demat account with us. Press 2 to Sell the same.
In this regard, it is hereby clarified that orders initiated by the Trading Members on behalf of clients through IVR (Interactive Voice Response) system and considering pressing a predefined number / option as order confirmation shall not be considered as the legally verifiable record of order placement.
The Trading Members are advised to take note of the above and ensure compliance by May 15, 2025.
In case of any queries / clarifications, trading members may contact us on the under mentioned nos.
For and on behalf of BSE Ltd.
Kaustubh Mundada Richa Ghosh
Assistant General Manager Assistant General Manager
Member Oversight Member Oversight
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