{"id":109166,"date":"2021-03-10T11:43:56","date_gmt":"2021-03-10T11:43:56","guid":{"rendered":"https:\/\/fin2me.com\/?p=109166"},"modified":"2021-03-10T11:43:56","modified_gmt":"2021-03-10T11:43:56","slug":"sebis-expert-panel-to-probe-glitch-at-nse-submit-report-by-march-15","status":"publish","type":"post","link":"https:\/\/fin2me.com\/business\/sebis-expert-panel-to-probe-glitch-at-nse-submit-report-by-march-15\/","title":{"rendered":"Sebi’s expert panel to probe glitch at NSE, submit report by March 15"},"content":{"rendered":"
Due to ineffectiveness of interoperability, brokers had to compulsorily square off their clients trading position, causing significant losses to investors.<\/strong><\/p>\n <\/strong><\/p>\n The Securities and Exchange Board of India’s (Sebi’s) technical advisory committee has been mandated to probe the trading halt at National Stock Exchange (NSE) and fix accountability.<\/p>\n The committee after a detailed examination would send its findings and recommendations to whole-time member Madbhi Puri Buch, to decide the future course of action, said two people in the know.<\/p>\n The panel, which is currently chaired by Ashok Jhunjhunwala of IIT Madras, is learnt to have sought an explanation over two key issues from NSE: One on the effectiveness of interoperability as it was unable to migrate the trading positions; the other on laxity in switching it to the disaster recovery site.<\/p>\n The other members of the panel are Abhay Karandikar of IIT Bombay, H Krishnamurthy of IISc Bangalore, and Vibhakar Bhushan, founder-director, Trignon Health.<\/p>\n “The committee will share its initial findings by March 15,” said one of the persons cited above.<\/p>\n In 2019, Sebi had chalked out the framework for business continuity plan and maintaining disaster recovery sites for market infrastructure institutions, including exchanges and clearing corporations in case of such disruption.<\/p>\n It also allows carrying out live trading from the disaster recovery site for two consecutive days every six months and conduct quarterly disaster recovery drills.<\/p>\n “Due to ineffectiveness of interoperability, brokers had to compulsorily square off their clients trading position, causing significant losses to investors.<\/p>\n “Based on an initial estimate, losses could be in thousands of crores,” said a regulatory source.<\/p>\n According to him, the regulator was not satisfied with the NSE’s claim of some issue with its two telecom service providers.<\/p>\n Prima facie, any cyberattack has been ruled by the regulator.<\/p>\n The expert panel has been also asked to check the technology employed by the NSE and whether the exchange is in a position to sustain the cluttered and heavy trades in all segments.<\/p>\n Meanwhile, the finance ministry is awaiting a detailed analysis by Sebi and the exchanges in the matter.<\/p>\n “We have been apprised about the issue but the further course of action is to be decided based on the detailed report,” said a ministry official.<\/p>\n He added the glitch also triggered the need for certain measures, on which “we are working to avoid such disruption in the future”.<\/p>\n On whether the exchanges would be held accountable and penalised, he said, that would depend on the outcome in the matter.<\/p>\n Finance Minister Nirmala Sitharaman said the unanticipated technical glitch that halted trading had cost the government “immensely” and there might have been an issue of interoperability.<\/p>\n “A couple of days ago when there was a kind of technology-driven glitch, which nobody could have anticipated, but that glitch has cost us immensely and lessons are being learned,” she said.<\/p>\n