Mutual funds, stocks investors and brokers alert! Sebi issues strict advisory to these entities

In a major development to ensure strict compliance with the prevention of unlawful activities law, markets regulator Sebi has issued a strict advisory to stock brokers, depositories, mutual fund houses and other market intermediaries. In a statement, Sebi advised market intermediaries to ensure compliance with instructions pertaining to UAPA or The Unlawful Activities (Prevention) Act.

Taliban and Al-Qaida

In addition, the regulator has asked market entities to ensure that accounts are not opened in the name of anyone whose name appears in updated list of individuals and entities linked to Taliban and Al-Qaida issued by the United Nation's Security Council.

Scan documents

"Scan all existing accounts to ensure that no accountant is held by or linked to any of the entities or individuals included in the list and also ascertain the same for future accounts," the Securities and Exchange Board of India (Sebi) said in a statement issued on Tuesday.

Comply with anti-money laundering guidelines

Also, the market intermediaries have been asked to comply with anti-money laundering guidelines and obligation for combating terrorism financing. Under anti-money laundering guideline and obligation for combating terrorism financing, Sebi has directed all intermediaries to ensure that "accounts are not opened in the name of anyone whose name appears in updated list of individuals and entities which are subject to various sanction measures such as freezing of assets/accounts, denial of financial services etc, approved by the security council committee established pursuant to various United Nations' Security Council Resolutions".

MEA notification

The statement comes after the Ministry of External Affairs has forwarded a notification issued by United Nations' Security Council Committee concerning ISIL (Da'esh), Al-Qaida, and associated individuals, groups, undertakings and entities regarding changes in the list of individuals and entities.