The Securities Appellate Tribunal has stayed an order by the stock markets regulator imposing strict restrictions on stock broker Way2Wealth in the ‘NSE leased line’ case.
The Securities and Exchange Board of India had, two weeks ago, imposed penalties and restrictions on several parties, including the National Stock Exchange, for facilitating or indulging in unfair trade practices involving quicker access to trading data.
The probe followed allegations that a few brokers were getting quicker access to trading data from the NSE after they were given ‘co-location’ facilities next to the exchange’s servers.
Co-location refers to allowing third parties to set up their own servers in the infrastructure owner’s premises in return for payment.
Faster access to NSE’s trading platform helps brokers beat their rivals in terms of fulfilling orders at more attractive prices.
SEBI had imposed a fine of Rs 625 cr, plus interest, on NSE in the case relating to 2015, and put restrictions on former NSE managing directors associating with any trading or market-related entities.
It had also imposed similar restrictions on the brokers who made use of the co-location facilities.
It asked Way2Wealth to deposit Rs 15.34 cr plus interest and banned it from signing on new clients for one year and carrying out trading activities on its own account for two years.
Shashibhushan, the CEO of Way2Wealth, was also prohibited from becoming associated with any “stock exchange, clearing corporation or depository recognized or registered by SEBI and/or in any intermediary registered with SEBI or any their related entities” for two years.
In case of Way2Wealth, said the company, “SAT passed an interim stay order.”
The next hearing has been posted for 22nd July 2019, it added.