Commodity markets regulator FMC has decided to levy up to 5 per cent penalty — of the shortfall in the required margin money — on members of the national commodity bourses from April 1 for failing to collect the required amount from clients.
Exchanges have also been asked to put in place a suitable mechanism to enable members report collection of all margins from their clients at the end of each trading day and to report short collection and non-collection on fifth day.
Members, also called brokers, are required to collect the `margin money’ from clients, which is later deposited with the exchange. Margin money includes a percentage of the value of commodity that a client is keen to trade.
FMC has issued fresh guidelines as the regulator has noticed several instances of non-collection and short collection of margins by members from their clients during inspection of their books of accounts.
