Sebi to use Benami Act

Apart from Benami Transaction Act, the Sebi has been advised by investor bodies like Investors Grievances Forum to file a case 8212; under the Section 420 of Indian Penal Code for cheating 8212; on behalf of other investors who applied for the shares under the retail investors quota.

Benami transactions are purchases in false name of another person, who does not pay the consideration but merely lends his name to the first person who actually purchased the asset and the beneficial owner.

Top Sebi officials also had a day-long meeting with officials of depositories8212;CDSL and NSDL. Sebi took suggestions on how to make the demat opening process more foolproof.

One of the ideas was to strictly implement 8216;know your client8217; norms and ask for one more identification document, like a PAN card, while opening a new demat account. It was also suggested that an employee of a DP should personally visit the demat account holder and should be held responsible if any wrongdoing surfaces later.