SEBI v. F6 Finserve Private Limited (stockbroker misuse of client funds, 2023)
Judgment entered
Checked against the primary document on October 9, 2026. The library's summary, tags and figures for this record were compared with the regulator's own document by an AI model (Claude) following written instructions, in a single reading of the order; an independent second reading of 60 SEBI records agreed on every field for 56, the four misses being penalty amounts; a later sample of 50 of the SEBI records added on 9 October agreed on every field for 46. No lawyer has reviewed them. A checked record can still contain errors, and checked does not mean endorsed. See how we check records or report a correction.
On 21 June 2023 a SEBI whole-time member cancelled the stockbroker registration of F6 Finserve, a firm already expelled from the exchanges, after earlier proceedings found it had misused client funds and securities and ignored inspectors.
The record
| Agency | SEBI (India) |
|---|---|
| Date filed | 2023-06-21 |
| Date resolved | 2023-06-21 |
| Court | SEBI whole-time member |
| Status | judgment |
| Asset class | equities |
| Instruments | client funds and client securities |
| Venue | NSE, BSE |
| Criminal parallel | No |
| Bars imposed | stockbroker registration cancelled |
| Defendants | F6 Finserve Private Limited |
| Techniques |
What was ordered
- Civil penalty
- —
- Disgorgement
- —
- Prejudgment interest
- —
- Total relief
- —
- Alleged gain
- —
What is alleged to have happened
A SEBI whole-time member, Ananth Narayan G., issued this final order on 21 June 2023 under section 12(3) of the SEBI Act and the Intermediaries Regulations 2008. The only noticee is F6 Finserve Private Limited, a stockbroker registered with the BSE and NSE in equity and derivative segments.
SEBI inspected the firm in August 2017 for the period April 2015 to July 2017. It then issued an interim order in May 2018 restraining the firm and related parties from the market, confirmed in December 2018. By April 2018 the exchanges had declared the firm a defaulter and expelled it. A 2022 order of the same authority and an adjudication order of October 2022, which imposed a Rs 89 lakh penalty, had already found the violations now relied on, and the firm did not appeal either.
The findings carried into this order include non-settlement of funds of inactive clients, non-segregation and misuse of client funds and securities, pledging of client securities, wrong margin reporting, unaddressed investor complaints and refusal to hand inspectors the data they sought. On the client-money point the inspection found client funds moved into the firm's own overdraft account and to other clients and to a director, with sample dates showing that roughly half of client credit balances were not backed by funds. The notice alleged breach of section 12A and Regulation 3 of the PFUTP Regulations 2003.
The firm did not reply to the post-enquiry show cause notice, which was served by affixture, or attend the hearing, and the order treats the charges as unrebutted. It cancels the certificate of registration, noting that loss of exchange membership alone is a ground for cancellation. No fresh monetary penalty is imposed in this order, and the firm remains liable for earlier acts and dues.
The record does not show how much clients lost or recovered, whether any criminal case was brought, or whether the firm's directors faced separate restrictions beyond those in the earlier orders. This matter concerns broker misuse of client assets rather than price manipulation.
This library does not assign a technique tag to the matter, because no technique in the library fits the conduct. The tagging is ours, not the regulator's.
For the regulator's own account of the facts, read the primary document linked above. This page deliberately summarises the structured record rather than reproducing the order.
Timeline
Primary documents
Everything on this page derives from the documents below. Where our summary and the primary document disagree, the primary document is right.