Domestic brokerage HDFC Securities on Tuesday settled with markets watchdog Sebi a case pertaining to alleged non-compliance with regulatory norms on payment of Rs 65 lakh towards settlement amount. The order came after the company filed an application with Sebi proposing to settle the alleged violations “without admitting or denying the findings of facts and conclusions of law” through a settlement order.
In its settlement order, Sebi said,”the instant adjudication proceedings initiated against the noticee viz., HDFC Securities Ltd, vide SCN (show cause notice)…dated August 8, 2024, are hereby disposed of”.
In the SCN, it was alleged that requirement of generating alerts for current capacity utilization of critical assets going beyond 70 per cent was not available in the broker’s IT policies and procedures with respect to capacity management procedure.
Further, the broker had set alerts at more than 80 per cent and 75 per cent for its tool like Meap application and CPU utilisation & memory in view of the prescribed 70 per cent for critical assets.
Also, the broker (HDFC Securities) had allegedly not implemented the LAMA system for its 47 servers out of 52 servers during the inspection period. LAMA allows the provisioning of application servers.
In addition, the broker had allegedly not conducted disaster recovery drills for 1 full trading day during the inspection period on a quarterly basis.
The broker’s cyber security and cyber resilience policy allegedly failed to define the frequency for periodic cyber and information security awareness training and identify critical and non-critical vendors.
Also, its policy for identifying critical and non-critical assets had allegedly not categorised all the critical applications and their servers (such as active directory for employee’s login, HSL internet facing website) as critical during the inspection period.
