SEBI to tighten listing norms for safer investing

Investors, especially retail investors have often complained that not much is done to protect small investor's  interests. There is a perception amongst investors that few companies openly flout laws and get away without any action taken against them, and retail investor is at the receiving end because he or she loses the capital invested in such fraudulent companies. 

SEBI the regulator for Indian capital markets, in a move that can help boost retail investors confidence when it comes to investing in shares, is mulling to tighten listing norms for companies. In a diversion from previous and current practices, SEBI now is planning to attach bank accounts and properties of promoters who have shown tendency to frequently flout listing and disclosure norms, and also fail in taking corrective action.

SEBI is planning tough action against those promoters who violate norms for more than two consecutive quarters and do not end up paying the penalties.To bring in seriousness on the whole issue of not following the listing norms, the penalty structure may also be reviewed and changed.

According to BSE data, as reported in News Daily, there are 2,498 cases of non-compliance in 1 year that ended as on March 31, 2016.

The current practice does not attach Bank accounts and properties of promoters. The existing SEBI norms penalise and suspend the company from trading on non compliance with listing regulations for a considerable time period.

The new listing norms will strengthen the corporate governance and investors should benefit from such stricter norms.