Last updated time: 09 March 2023, 18:05 IST
Hard recovery charges are those that cannot be recovered even after all recovery modes have been exhausted.
The reward can be given in two stages – intermediate and final stage.
In a bid to recover fines from defaulters, capital markets regulator Sebi on Thursday introduced a reward system of up to Rs 20 lakh to whistleblowers for sharing information about assets of defaulters.
The reward can be given in two stages – intermediate and final stage.
The amount of the interim remuneration shall not exceed two and a half percent of the reserve price of the asset or Rs.5 million, whichever is less, and the amount of the final remuneration shall not exceed 10 percent of the premiums collected. or Rs.20 lakhs, whichever is less.
Sebi, which came out with instructions to reward an informer who provides reliable information about the assets of the defaulter during the production process, said “the information and identity provided by the informer or the reward paid to him will be kept confidential”. According to Sebi, a person is considered to be an informer entitled to remuneration if he provides original information regarding the asset of the defaulter in respect of contributions certified as ‘Hard to Recover’.
Hard recovery charges are those that cannot be recovered even after all recovery modes have been exhausted.
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The regulator has also released a list of 515 payers, where information can be provided by any whistleblower.
In addition, for the purpose of offering reward opportunities, Sebi has constituted a Whistleblower Reward Committee consisting of Chief General Manager of Production and Refund Department, concerned recovery officer having jurisdiction in this matter, and other recovery officer appointed by the Chief. An official of the rank of General Manager and Deputy Director General or higher of the Office of Investor Assistance and Education appointed by the General Manager, which is managed by the Investor Protection and Education Fund (IPEF).
The committee on awarding informants submits its proposals to the competent authority on the issues of determining the amount of remuneration to which informants have the right to be awarded and to be paid to informants.
Sebi said the whistleblower reward will be paid from the Investor Protection and Education Fund.
The new guidelines came into effect from March 8, the Securities and Exchange Board of India (Sebi) said.
According to Sebi’s annual report for 2021-22, the markets regulator had disbursed Rs 67,228 crore under the “difficult to recover” (DTR) category at the end of March 2022.
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(This story was not edited by News18 staff and was published by a syndicated news outlet)
