SECURITIES AND EXCHANGE BOARD OF INDIA
SMDRP/POLICY/CIR- 36/2000
August 4, 2000
To
All Depository Participants
Dear Sir,
SEBI has been continuously stressing the importance of exercising utmost care and caution in the opening of beneficiary owner’s accounts and diligently following the instructions laid down for the purpose in various SEBI circulars. It is extremely important that all documents are verified with the original and the photographs and signature duly authenticated, before accounts are opened. These are critical steps for the safety, integrity and efficient functioning of the depository system. Any failure in this regard could invite appropriate regulatory action.
The depository participants are hereby advised that:
a. A beneficiary account must be opened only after obtaining a proof of identity of the applicant. The applicant’s signature and photograph must be authenticated by an existing account holder or by the applicant’s bank or after due verification made with the original of the applicant’s valid passport, voter ID, driving license or PAN card with photograph; and further,
b. the account opening form should be supported with proof of address such as verified copies of ration card / passport / voter ID / PAN card / driving license / bank passbook. An authorized official of the depository participant, under his signature shall verify the original documents.
You are directed to immediately verify the accounts of all the beneficiary owners who have opened accounts with you and confirm in writing to the depository, within 30 days of the receipt of this letter, that you have fully complied with the above procedure in all the cases.
In case any account holder fails to produce the original documents for verification within the above period of 30 days, it must be immediately brought to the notice of the concerned depository. Failure to produce the original documents within the prescribed time would invite appropriate action against such account holders, which could even include freezing of their account.
SEBI would also be constrained to take appropriate action including suspension/cancellation of the certificate of registration as may be deemed necessary against the DPs who have been found to have opened accounts without following the due procedure or have not complied with the above instructions.
Yours faithfully,
SECONDARY MARKET, DEPOSITORIES, RESEARCH AND PUBLICATIONS DEPARTMENT E-mail : [email protected] Ph.: 282 2333
Copy to: 1. National Securities Depository Limited
2. Central Depository Services (India) Limited.
