Safeguards on transfer of securities in dematerialized mode

Safeguards to address the concerns of the investors on transfer of securities in dematerialized mode

1. Para 1.12 of SEBI Master circular for Depositories dated October 06, 2023 prescribed guidelines to address the concerns arising out of transfer of securities from the Beneficial Owner (BO) Accounts without proper authorization by the concerned investor.
   
2. To harmonize the classification of inactive/dormant accounts across Stock Exchanges & Depositories and to strengthen the measures to prevent fraud/misappropriation for inoperative demat accounts, based on consultation with depositories and the recommendations of SMAC, it has been decided to amend Para1.12 as under:
   
   1.12. Safeguards to address the concerns of the investors on transfer of securities in dematerialized mode Following safeguards shall be put in place to address the concerns of the investors arising out of transfer of securities from the BO Accounts:
   
   1.12.1.The depositories shall give more emphasis on investor education particularly with regard to careful preservation of Delivery Instruction Slip (DIS) by the BOs. The Depositories may advise the BOs not to leave “blank or signed” DIS with the Depository Participants (DPs) or any other person/entity.
   1.12.2.The DPs shall not accept pre-signed DIS with blank columns from the BO (s).
   1.12.3. If the DIS booklet is lost/stolen/not traceable by the BO, the same must be intimated to the DP immediately by the BO in writing. On receipt of such intimation, the DP shall cancel the unused DIS of the said booklet.

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