Paytm Money Settles Case With SEBI For ₹45.50 Lakhs Over Regulatory Violations
Paytm Money, the stock broking arm of One97 Communications, has reached a settlement with the Securities and Exchange Board of India (SEBI) by paying a sum of ₹45.50 lakh. The settlement was made without the company admitting or denying the findings of an investigation into alleged violations of regulatory norms.
The case stemmed from Paytm Money’s failure to adhere to SEBI’s technical glitch framework circular issued on November 25, 2022. Specifically, the company was accused of not setting the required 70% permissible limit for generating timely alerts on critical assets. Additionally, it failed to submit documentary evidence regarding the peak load observed during the inspection period and did not connect its critical systems with the Log Analytics and Monitoring Application. The company also failed to conduct live Disaster Recovery (DR) drills for a period of six months between April and September 2023.
SEBI initiated the inquiry on July 9, 2024, and issued a Show Cause Notice on July 24, 2024, questioning why an inquiry and penalty should not be imposed for the violations. In response, Paytm Money proposed to settle the case without admitting to or denying the findings, submitting a settlement application on September 17, 2024.
The High-Powered Advisory Committee (HPAC) met on November 18, 2024, to review the terms of the proposed settlement and recommended it. The Panel of Whole Time Members of SEBI subsequently approved the settlement on January 27, 2025, as per a three-page order.