JOIN USIt is for the second time in as many months the regulator is asking the bourses to take stern action to curb rampant cash dealings. After a directive from FMC in June, commodity exchanges came up a penalty of 0.1 per cent for every cash dealing of over Rs 10 lakh which, however, did not succeed much to prevent such a practice.
It is against this background that the watchdog has written again to exchanges to impose stringent penalty on cash transactions.
“We reiterate our position that cash transactions will not be allowed in the commodities futures market. We have directed exchanges to make necessary amendments in their by laws and put in place stringent rules to enforce the directions,” FMC Member Rajeev Aggarwal told sources.The regulator has found that the commodity exchanges are not levying penalty on cash dealings of below Rs 10 lakh and issued a clarification saying, “Trading members should not accept cash from clients against any obligation, including margin money for trading in commodity derivatives, with immediate effect.
“All payments should be received or made by members/from clients should strictly be via account payable cheque or demand draft or any other ways prescribed by RBI.”