Terms and Conditions
Open Futures will preserve all your personal information, which will be compiled into a database for the personal use of Open Futures.
Open Futures will provide the facility to edit your account information and preferences at any time. Your account information is password protected for security and privacy. Please maintain the secrecy and privacy of your user name and password.
The information which will be provided by you at the time of registration is your name, address, e-mail address, birth date, gender, zip code, education, occupation, industry and personal interest.
The information gathered is mainly utilised to customise the content you see, attend your request promptly and notify you about the updation of the site.
Open Futures will preserve all your personal information, which will be compiled into a database for the personal use of Open Futures.
Open Futures will provide the facility to edit your account information and preferences at any time. Your account information is password protected for security and privacy. Please maintain the secrecy and privacy of your user name and password.
DISCLOSURE REGARDING PROPRIETARY TRADING
In pursuance to SEBI Circular No. SEBI/MRD/SE/Cir-42/2003 dated 19.11.2003, Open Futures hereby informs its client that it is doing proprietary trading for itself in the Cash segment and Derivatives segment of both the exchanges i.e. NSE. Such positions may carry the same risks as client positions.
Kindly note the same and acknowledge the receipt.
I/We ________________________________________________________________________________, Self/Karta/Proprietor of ___________________________________________________________, having client code _________________________ with Open Futures, acknowledge the receipt of the above.
Client Signature _______________________ Date: _____________________
Inactive Client Policy
Client Accounts which have been inactive for 6 Months or more will be considered Dormant Accounts and the assets lying therein will be returned. We have categorized them as below:
6 Months Dormant Accounts: Those trading accounts in which trading has not taken place in the last 6 Months. Once a client code has been inactive for 6 Months, it shall be marked disabled in the back office as well as on the trading platforms, so that no trade can be undertaken/punched for it. If a client wishes to re-initiate trading on their account, they will be required to furnish a written request letter for re-enablement of the UCC. This letter should be signed by the client only and not by a POA holder.
Very Old Dormant Accounts: Those trading accounts in which trading has not taken place in the last two years. Once a client code has been inactive for two years, it shall be marked disabled in the back office as well as on the trading platforms, so that no trade can be undertaken/punched for it. If a client wishes to re-initiate trading on their account, they will be required to fulfill KYC formalities and furnish a written request letter for re-enablement of the UCC. This letter should be signed by the client only and not by a POA holder.
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Anti Money Laundering Policy
The Government of India has serious concerns over money laundering activities which are not only illegal but anti-national as well. As a market participant it is evident that strict and vigilant tracking of all transactions of a suspicious nature is required.
Accordingly, the Company has laid down following policy guidelines:
Ms. Bhawna Joshi is appointed as the Principal Officer. She will be responsible for the implementation of internal controls & procedures for identifying and reporting any suspicious transaction or activity to the concerned authorities.
Purpose & Scope:
As a Financial Market Intermediary (which includes a stock-broker, sub-broker) we need to maintain a record of all transactions, the nature and value of which has been prescribed in the Rules under the PMLA. Accordingly, all the back office and trading staff is instructed to observe the following safeguards:
- No Cash transactions for trading in securities shall be allowed from any client in the normal course of business.
- A record of all transactions must be maintained, the nature and value of which has been prescribed in the Rules notified under the PMLA. Such transactions include:
- i. Cash transactions of a value of more than Rs 10 lakhs or its equivalent in foreign currency.
- ii. All series of cash transactions integrally connected to each other which have been valued below Rs 10 lakhs or its equivalent in foreign currency where such series of transactions take place within one calendar month.
- iii. All suspicious transactions whether or not made in cash.
- Frequent off market transfers from one BO account to another shall be scrutinized and asked for. In absence of a valid reason or if found suspicious, it shall be brought to the notice of the Principal Officer.
- Trading beyond one’s declared income: The turnover of the client should be according to their declared means of income. Any abnormal increase in clients turnover shall be reported to the Principal Officer. The Back Office staff should take due care in updating the clients financial details and shall periodically review the same.
Policies & Procedures:
The Know Your Client (KYC) Policy:
a) While establishing the intermediary-client relationship
No account shall be opened unless all the KYC Norms as prescribed from time to time by the SEBI/Exchanges are duly complied with. All the information that is required to be filled in the KYC form (including financial information, occupation details and employment details) must actually be filled in and the documentary evidence in support of the same must be made available by the client. Moreover, all the supporting documents should be verified with the originals. The client must sign the KYC & MCA in presence of our own staff. New clients must be introduced by an existing client or a known reference.The information provided by the client should be checked though independent sources, namely:
- PAN No. must be verified from the Income Tax website.
- Address must be verified by sending a Welcome Letter/Quarterly Statement of Account, and in case any document is returned undelivered, the client should be asked to provide his new address proof before any further transactions are undertaken.
- We must exercise additional due diligence in case of the clients of Special Category which include but are not limited to:
- i. Nonresident clients
- ii. High net worth clients (i.e. clients having a net worth exceeding 20 Lakhs and/or doing intraday trading volume of more than 2 Crore and/or having a daily delivery volume of more than Rs 20 Lakhs)
- iii. Trusts, Charities, NGOs and other organisations receiving donations.
- iv. Companies having close family shareholdings or beneficial ownership.
- v. Politically exposed persons (PEP) of foreign origin.
- vi. Current/former Head of State, current/former high profile politicians and connected persons (immediate family, close advisors and companies in which such individuals have interest or significant influence).
- vii. Companies offering foreign exchange offerings.
- viii. Clients in high risk countries (where existence/effectiveness of money laundering controls is suspect, where there is unusual banking secrecy, where there is active narcotics production, where corruption (as per Transparency International Corruption Perception Index) is highly prevalent, against which government sanctions are applied, where fraud is highly prevalent, and/or which are reputed to be any of the following – havens/sponsors of international terrorism, offshore financial centres, tax havens).
- ix. Non face to face clients.
- x. Clients with dubious reputation as per public information available.
- xi. Any other persons/companies who as per our independent judgment may be classified as CSC.
In case we have reasons to believe that any of our existing/potential customers is a politically exposed person (PEP), we must exercise due diligence to ascertain whether the customer is indeed so, which would include seeking additional information from clients and accessing publicly available information etc. The dealing staff must obtain senior management’s prior approval for establishing business relationships with Politically Exposed Persons. In case an existing customer is subsequently found to be or subsequently becomes a PEP, dealing staff must obtain senior management’s approval to continue the business relationship.
We must take reasonable measures to verify sources of funds of clients identified as PEP.
The client should be identified by using reliable sources including documents/information and we should obtain adequate information to satisfactorily establish the identity of each new client and the purpose of the intended nature of the relationship.
The information should be adequate enough to satisfy competent authorities (regulatory/enforcement authorities) that due diligence was observed by the intermediary in compliance with the Guidelines. Each original document should be seen prior to acceptance of a copy.
Failure by a prospective client to provide satisfactory evidence of identity should be noted and reported to the higher authority.While accepting a client, the underlying objective should be to follow the requirements enshrined in the PML Act, 2002 SEBI Act, 1992 and Regulations, directives and circulars issued thereunder so that we are aware of the clients on whose behalf we are dealing.
b) While carrying out transactions for the client
RMS department should monitor the trading activity of the client and exercise due diligence to ensure that the trading activity of the client is not disproportionate to the financial status and the track record of the client.
Payments department should ensure that payments received from the client are being received in time and through the bank account of which details are given by the client in KYC form. Payments through cash/bearer demand drafts should not be entertained.
c) Policy for acceptance of clients:
The following safeguards are to be followed while accepting the clients:
No account is to be opened in a fictitious/benami name or on an anonymous basis. To ensure this we must insist the client to fill all the necessary details in the KYC form in our presence and obtain all the necessary documentary evidence in support of the information filled in KYC. We must verify all the documents submitted in support of the information filled in the KYC form with the originals and in-person verification should be done by our own staff. Moreover, new clients should either be introduced by an existing customer or by a senior official of the company. In case we have any suspicion that incomplete/fictitious information has been submitted by the client, we must ask for such additional information so as to satisfy ourselves about the genuineness of the client and the information of the client before accepting their registration.
Factors of risk perception of the client:-
|Factors of Risk Perception having regard to :|
|Client Location (Registered/Correspondence/other address)|
|– Face to Face clients of Delhi NCR||Low Risk|
|– Face to Face clients of other than Delhi NCR||Low Risk|
|– Client Introduced by existing Face to Face Clients||Low Risk|
|– Client Introduced by other Existing Clients||Medium Risk|
|– Direct Clients of Delhi NCR||Medium Risk|
|– Direct Clients of other than Delhi NCR||High Risk|
|– Nonresident Clients||High Risk|
|Nature of Business Activity, Trading Turnover etc|
|-Retail clients (average daily turnover < Rs 10 Lakhs or net settlement obligation < Rs 2 Lakhs)||Low Risk|
|– Retail clients (average daily turnover < Rs 25 Lakhs or net settlement obligation < Rs 5 Lakhs)||Medium Risk|
|– HNI Clients (average daily turnover > Rs 25 Lakhs or net settlement obligation > Rs 5 Lakhs)||High Risk|
|Manner of Making Payment|
|– Regular payment through A/c payee cheque from the Bank A/c already mapped with us||Low Risk|
|– Payment through A/c payee cheque from the Bank A/c other than one already mapped with us||Medium Risk|
|– Payment through Banker’s Cheque / Demand Draft / Cash||High Risk|
|Client of Special Categories as defined under Para(a) of these Guidelines:||Very High Risk|
Ensure that no account is opened where we are unable to apply appropriate due diligence measures/KYC policies. This shall be applicable in cases where it is not possible to ascertain the identity of the client or information provided by the client is suspected to be non genuine or there is perceived non co-operation of the client in providing full and complete information. We should not continue to do business with such a person and file a suspicious activity report. We should also evaluate whether there is suspicious trading in the account and whether there is a need to freeze or close the account.
Recruitment of personnel
The HR Department is instructed to cross check all references and should take adequate safeguards to establish the authenticity and genuineness of a person before recruiting. The department should obtain the following documents:
- 1. Photographs
- 2. Proof of address
- 3. Identity proof
- 4. Proof of Educational Qualification
- 5. References
Retention of Records
Records pertaining to active clients and staff details collected for recruitment shall be kept safely.
Information to be maintained
Company will maintain and preserve the following information in respect of transactions referred to in Rule 3 of PMLA Rules for the period of 10 years:
- Client Registration Forms
- Contract Note
- The nature of the transactions;
- The amount of the transaction and the currency in which it denominated;
- The date on which the transaction was conducted; and
- The parties to the transaction.
The Company has adopted an ongoing employee training program so that the members of the staff are adequately trained in AML and CFT procedures. Training requirements have specific focuses for frontline staff, back office staff, compliance staff, risk management staff and staff dealing with new customers. It is crucial that all those concerned fully understand the rationale behind these guidelines, obligations and requirements, implement them consistently and are sensitive to the risks of their systems being misused by unscrupulous elements.
Implementation of AML/CFT measures requires back office and trading staff to demand certain information from investors which may be of personal nature, or which has hitherto never been called for. Such information can include documents evidencing source of funds/income tax returns/bank records etc. This can sometimes lead to raising of questions by the customer with regard to the motive and purpose of collecting such information. There is, therefore, a need for the back office and trading staff to sensitize their customers about these requirements as the ones emanating from AML and CFT framework. The back office and trading staff should prepare specific literature/pamphlets etc. so as to educate the customer of the objectives of the AML/CFT programme.
Suspicious Transaction Monitoring & Reporting to FIU
As per our observations, if any transaction of suspicious nature is identified it must be brought to the notice of the Principal Officer who will submit a report to the FIU if required. The above said policies are reviewed by us on a regular basis to keep them updated as per the various amendments in the PMLA rules.
Policies & Procedures
1. Setting up client’s exposure limit and conditions under which a client may not be allowed to take further position or the broker may close the existing position of a client:
The stock broker may from time to time impose and vary limits on the orders that the client can place through the stock broker’s trading system (including exposure limits, turnover limits, limits as to the number, value and/or kind of securities in respect of which orders can be placed etc.). The client is aware and agrees that the stock broker may need to vary or reduce the limits or impose new limits urgently on the basis of the stock broker’s risk perception and other factors considered relevant by the stock broker including but not limited to limits on account of exchange/SEBI directions/limits (such as broker level/ market level limits in security specific/volume specific exposures etc.), and the stock broker may be unable to inform the client of such variation, reduction or imposition in advance. The client agrees that the stock broker shall not be responsible for such variation, reduction or imposition or the client’s inability to route any order through the stock broker’s trading system on account of any such variation, reduction or imposition of limits. The client further agrees that the stock broker may at any time, at its sole discretion and without prior notice, prohibit or restrict the client’s ability to place orders or trade in securities through the stock broker or it may subject any order placed by the client to a review before its entry into the trading systems and may refuse to execute/allow execution of orders due to but not limited to the reason of lack of margin/securities or the order being outside the limits set by stock broker/exchange SEBI and any other reasons which the stock broker may deem appropriate in the circumstances. The client agrees that the losses, if any, on accounts of such refusal or due to delay caused by such review, shall be borne exclusively by the client alone.
The stock broker is required only to communicate/advise the parameters for the calculation of the margin/security requirements as rates/percentages of the dealings. Through any one or more means or methods such as post/speed post/courier/registered post/registered A.D./facsimile/telegram/cable/e-mail/voice mails/telephone (telephone includes such devices as mobile phones etc.) including SMS on the mobile phone or any other similar device; by messaging on the computer screen of the client’s computer; by informing the client through employees/agents of the stock broker; by publishing/displaying it on the website of the stock broker/making it available as a download from the website of the stock broker; by displaying it on the notice board of the branch/office through which the client trades or if the circumstances, so require, by radio broadcast/television broadcast/newspapers advertisements etc; or any other suitable or applicable mode or manner. The client agrees that the postal department/the courier company/newspaper company and the e-mail/voice mail service provider and such other service providers shall be the agent of the client and the delivery shall be complete when communication is given to the postal department/the courier company/e-mail/voice mail service provider, etc. by the stock broker and the client agrees never to challenge the same on any grounds including delayed receipt/non receipt or any other reasons whatsoever and once parameters for margin/security requirements are so communicated, the client shall monitor his/her/its position (dealings/trades and valuating of security) on his/her/its own and provide the required/deficit margin/security forthwith as required from time to time whether or not any margin call or such other separate communication to that effect is sent by the stock broker to the client and/or whether or not such communication is received by the client.
The client is not entitled to trade without adequate margin/security and that it shall be his/her/its responsibility to ascertain beforehand the margin/security requirement for his/her/its orders/trades/deals and to ensure that the required margin/security is made available to the stock broker. If the client’s order is executed despite a shortfall in the available margin, the client shall whether or not the stock broker intimates such shortfall in the margin to the client, make up the shortfall suo moto immediately. The client further agrees that he/she/it shall be responsible for all orders (including any orders that may be executed without the required margin in the client’s account) and /or any claim/loss/damage arising out of the non availability/shortage of margin/security required by the stock broker and/or exchange & or SEBI.
The stock broker is entitled to vary the form (i.e., the replacement of the margin/security in one form with the margin/security in any other form, say, in the form of money instead of shares) and/or quantumand/or percentage of the margin and/or security required to be deposited/made available, from time to time.
The margin/securities deposited by the client with the stock broker are not eligible for any interest.
The stock broker is entitled to include/appropriate any/all pay-out of funds and/or securities towards margin/security without requiring specific authorizations for each pay-out.
The stock broker is entitled to transfer funds/or securities from his account for one exchange and/or one segment of the exchange to his/her/its account for another exchange and/or another segment of the exchange.
The stock broker is entitled to disable/freeze the account and/or trading facility/any other service facility if in the opinion of the stock broker the client has committed a crime/fraud or has acted in contradiction of this agreement and/or is likely to evade/violate any laws, rules, regulations, directions of a lawful authority whether Indian or foreign or if the stock broker so apprehends.
2. Applicable brokerage rate: the stock broker is entitled to charge brokerage within the limits imposed by exchange which at present is as under:
(a) For Cash/Futures/Currency and interest rate futures market segment: The maximum brokerage chargeable in relation to trades effected in the securities admitted to dealing on the Capital Market/Futures/Currency and Interest rate futures segment shall be 2.5% of the contract price exclusive of statutory levies. It is hereby further clarified that where the sale/purchase value of a share is Rs.10/- or less in capital market segment, maximum brokerage of 25 paise per share may collected.
(b) For Option contracts: Brokerage for option contracts shall be charged on the premium amount at which the option contrast was bought or sold and not on the strike price of the option contract. It is hereby further clarified that brokerage on options contracts shall not exceed 2.5% of the premium amount or Rs.100/- (per lot) whichever is higher.
3. Imposition of penalty/delayed payment charges: The client agrees that any amounts of any other reason to the stock broker will be charged with delayed payment charges at such rates as may be determined by the stock broker:
The client agrees that the stock broker may impose fines/penalties for any orders/trades/deals/actions of the client which are contrary to this agreement/rules/regulation/bye laws of the exchange or any other law for the time being in force, at such rates and in such as it may deem fit. Further where the stock broker has to pay any fine or bear any punishment from any authority in connection with/as a consequence of/in relation to any of the orders/trades/deals/action of the client, the same shall be borne by the client.
The client agrees to pay to the stock broker brokerage, commission, fees, all taxes, duties, levies imposed by any authority including but not limited to the stock exchanges (including any amount due on account of reassessment/backlogs etc.) transaction expenses, incidental expenses such as postage, courier etc. as they apply from time to time to the client’s account/transactions/services that the client avails from the stock broker.
4. The right to sell client’s securities or close client’s positions without giving notice to the client on account of non-payment of client’s dues:
The stock broker maintains centralized banking and securities handling processes and related banking and depository accounts at a designated place. The client shall ensure timely availability of funds/securities in designated form and manner at designated time and in designated bank and depository accounts at designated place, for meeting his/her/its pay in obligation of funds and securities. The stock broker shall not be responsible for any claim/loss/damage arising out of non availability/short availability of funds/securities by the client in the designated accounts of the stock broker for meeting the pay in obligation of either funds or securities. If the client gives order/trades in the anticipation of the required securities being available subsequently for pay-in through anticipated pay-out from the exchange or through borrowing of any market deliveries and if such anticipated availability does not materialize in actual availability of securities/funds for pay-in for any reason whatsoever including but not limited to any deals/shortage at the exchange or stock broker level/non release of margin by the stock broker etc. the losses which may occur to the client as a consequence of such shortage in any manner such as on account of auctions/square off/closing out etc. shall be solely to the account of the client and the client agrees not to hold the stock broker responsible for the same in any form or manner whatsoever. In case the payment of the margin/securities made by the client though a bank instrument the stock broker shall be at liberty to give the benefit/credit for the same only on the realization of the funds from the said bank instrument etc. at the absolute discretion of the stock broker where the margin/securities made available by way of securities or any other property. The stock broker is empowered to decline its acceptation as margin/securities and/or to accept it at such reduced value as the stock broker may deem fit by applying haircut or by valuing it by marking it to market or by any method as the stock broker may deem fit at its absolute discretion.
The stock broker has the right but not the obligation to cancel all pending orders to sell/close/liquidate all open positions/securities/shares at the pre-defined square off time or when marked to market (M-T-M) percentage reaches or crosses stipulated margin percentage maintained on the website, whichever is earlier. The stock broker will have sole discretion to decide referred stipulated margin percentage depending upon the market condition. In the event of such square off, the client agrees to bear all the process based on actual executed prices. In case open position (i.e. short/long) gets converted into delivery due to non square off because of any reason whatsoever, the client agrees to provide securities/funds to fulfill the pay in obligation failing which the client will have to face auction or internal close out; in addition to this the client will have to pay penalties and charges levied by exchange in actual and losses, if any, without prejudice to the foregoing; the client shall also be solely liable for all and any penalties and charges levied by the exchanges. The stock broker is entitled to prescribe the date and time by which the margin/security is to be made available and the stock broker may refuse to accept any payment in any form after such deadline for margin/security expires. Notwithstanding anything to the contrary in the agreement or elsewhere, if the client fails to maintain or provide the required margin/funds/security and to meet the funds/margins/securities pay in obligation for the order/trades/deals of the client within the prescribed time and form, the stock broker shall have the right without any further notice or communication to the client take any one or more of the following steps:-
i) To withhold any payout of funds/securities
ii) To withhold/disable the trading dealing facilities to the client
iii) To liquidate one or more securities of the client by selling the same in such manner and at such rate which the stock broker may deem fit in its absolute discretion. It is agreed and understood by the client that securities here include securities which are pending delivery/receipt.
iv) To liquidate/square off partially or fully the positions of sell and/or purchase any one or more securities/contacts in such manner and at such rates which the stock broker may decide at its absolute discretion.
v) To take any other step which in the given circumstances, the stock broker may deem fit.
The client agrees that the losses if any, on account of any one or more steps as enumerated herein above being taken by the stock broker, shall be borne exclusively by the client alone and agrees not to question the irresponsibleness, requirements, timing, manner, form, pricing etc. which are chosen by the stock broker.
5. Temporarily suspending or closing a client’s account at the client’s request:
i) The client may request the stock broker to temporarily suspend his account. The stock broker may do so subject to client’s accepting/adhering to conditions imposed by stock broker including but not limited to settlement of account and/or the obligation.
ii) The stock broker can withhold the payouts of the client and suspend his trading account due to his surveillance action or judicial and/or regulatory order/action requiring client suspension.
6. De-registering a client: Notwithstanding anything to the contrary stated in the agreement, the stock broker shall be entitled to terminate the agreement with immediate effect in any of the following circumstances:
i) If the actions of the client are prima facie illegal/improper, such as to manipulate the price of any securities, disturb the normal/proper functioning of the market, either alone or in conjunction with other.
ii) If there is any commencement of a legal process against the client under any law.
iii) On the death/lunacy or other disability of the client.
iv) If a receiver, administrator or liquidator has been appointed or allowed to be appointed of all or any part of the undertaking of the client.
v) If the client has voluntarily or compulsorily become the subject of proceedings under any bankruptcy or insolvency law or being a company, goes into liquidation or has a receiver appointed in respect of reconstruction or under any other law providing protection as a relief undertaking.
vi) If the client being a partnership firm, has any step taken by the client and/or its partners for dissolution of the partnership.
vii) If the client has taken or suffered to be taken any action for its reorganization, liquidation or dissolution.
viii) If the client has made any material misrepresentation of facts, including (without limitation) in relation to the Security;
ix) If there is reasonable apprehension that the Client is unable to pay its debts or the Client has admitted its inability to pay its debts, as they become payable;
x) If the client suffers any adverse material change in his/her/its financial position or defaults in any other agreement with the stock broker;
xi) If the Client is in breach of any term, condition or covenant of this agreement;
xii) If any covenant or warranty of the client is incorrect or untrue in any material respect;
However, notwithstanding any termination of the agreement, all transactions made under/pursuant to this agreement shall be subject to all the terms and conditions of this agreement and parties to this agreement submit to exclusive jurisdiction of courts of law at the place of execution of this agreement by the stock broker.
7. Refusal of orders for penny / illiquid stock: The stock broker may from time to time limit (quantity/value) / refuse orders in one or more securities due to various reasons including:
market, liquidity, value of securities, the order being for securities which are not in the permitted list of the stock broker / exchanges /SEBI provided further that stock broker may require compulsory settlement /advance payment of expected settlement value /delivery of securities for settlement prior to acceptance/placement of orders as well the client agrees that the losses, if any on account of such refusal are due to daily caused by such limits , shall be borne exclusively by the client alone.
The stock broker may require reconfirmation of orders which are larger than that specified by the stock brokers’risk management, and is also aware that the stock broker has the discretion to reject the execution of such orders based on its risk perception.
8. Shortage in obligation arising out of internal netting of trades: stock broker shall not be obliged to deliver any securities or pay any money to the client unless and until the same has been received by the stock broker from the exchange, the clearing corporation/clearing house or other company or entity liable to make payment and the client has fulfilled his/her/its obligation first:
The policy and procedure for settlement of shortage in obligation arising out of internal netting up trades is as under:
- The short delivery client is debited by an amount equivalent to 20% above of closing rate of the day prior to pay-in/pay-out day. The securities delivered short are purchased from market on T+3 day which is the auction day on exchange, and the purchase consideration (inclusive of all statutory taxes & levies) is debited to the short delivering seller client along with reversal entry of provisionally amount debited earlier.
- If securities cannot be purchased from market due to any force majeure condition, the short delivery seller is debited at the closing rate on T+3 day or auction day on exchange + 10% where the delivery is matched partially or fully at the exchange clearing the delivery and debits/credits shall be as per exchange debits and credits.
- In cases of securities having corporate actions all cases of short delivery of cum transactions which cannot be auctioned on cum basis auction payout is after the book closure/record date, would be compulsorily closed out at higher of 10% above the official closing price on the auction day orthe highest traded price from first trading day of the settlement till the auction day.Client Acceptance of Policies and Procedures stated hereinabove: I/We have fully understood the same and do hereby sign the same and agree not to call into question the validity, enforceability and applicability of any provisions/clauses of this document under any circumstances whatsoever. These Policies and Procedures may be amended/changed unilaterally by the broker, provided the change is informed to me/us through any one or more means or methods such as post/speed post/courier/registered post/registered A.D./facsimile/telegram/cable/e-mail/voice mails/telephone (telephone includes such devices as mobile phones etc.) including SMS on the mobile phone or any other similar device; by messaging on the computer screen of the clients computer; by informing the client through employee/agents of the stock broker; by publishing/displaying it on the website of the stock broker/making it available as a download from the website of the stock broker; by displaying it on the notice board of the branch/office through which the client trades or if the circumstances so require, by radio broadcast/television broadcast/newspapers advertisements etc; or any other suitable or applicable mode or manner. I/We agree that the postal department/the courier company/newspaper company and the e-mail/voice mail service provider and such other service providers shall be my/our agent and the delivery shall be complete when communication is given to the postal department/the courier company/the e-mail/voice mail service provider, etc. by the stock broker and I/we agree never to challenge the same on any grounds including delayed receipt/non receipt or any other reasons whatsoever. These Policies and Procedures shall always be read along with the agreement and shall be compulsorily referred to while deciding any dispute/difference or claim between me/us and stock broker before any court of law/judicial/adjudicating authority including arbitrator/mediator etc.
401, Chiranjiv Tower
43 Nehru Place,
New Delhi – 110019
RISK MANAGEMENT & INTERNAL CONTROL POLICY
This document shall be deemed as the official guidelines, policies and procedures to be followed by Open Futures while carrying out its business activities as a member of the National Stock Exchange of India Ltd.
The objective of this document is to effectively manage the various risks involved in the business operations which may include default by clients, fraud and infidelity by employees, technological failures, misuse of the trading system for market manipulations apart from protecting the interests of investors and ensuring the effective and timely compliance with various applicable Acts, rules, regulations, bye-laws, circulars and guidelines.
Manner of usage:
This document shall be used as guidelines and reference by the key personnel in charge of the activities namely client identification and introduction, surveillance, record keeping, the personnel in charge of executing and authorizing the day to day transactions, as well as by the business associates who are involved in the activities as mentioned above. The Compliance Officer (CO) shall provide a copy of this document to all such existing as well as new key personnel and business associates from time to time and explain the contents and their responsibilities in this regard.
Risk Management & Internal Controls:
1. Registration of clients:
It is the policy of the company to carry client registration in house.
KYC procedures as prescribed by SEBI/Stock Exchange are to be strictly followed while ascertaining the identity and verifying the proof of address of the new clients.
Identity proof of banking account and demat account shall be obtained before entering the details of bank and demat account in the client master database.
2. Receiving, validating & entering the orders of clients in the trading platforms:
Normally, the new clients shall be assigned and introduced to a specific terminal operator and the operator shall be briefed about client requirements for trading, investments and their risk taking abilities. Accordingly the terminal operator shall, under instruction from the concerned senior official.
3. Collection and release of payments to clients:
The client shall be asked to make the full payment as per the daily debit obligation on T+1 basis.
The pay-out of funds shall be made on T+2 basis after confirming the successful pay-in of securities by the client.
The exchange/segment wise segregated ledger account shall be maintained with an option to view the exchange position.
Under written authorization from the client, the pay-out of funds can be retained for margins and/or future pay-in obligation and for collection and release of funds the account shall be maintained on a running account basis with exchange net balance criteria.
4. Collection and maintenance of margins:
The requirement of collection and maintenance of margins in Cash/Capital Market segment is waived.
In case of the clients having relatively large volume and regular trading activities, the pay-out of funds and securities shall be retained towards the upfront and daily margins under the written authorization from the clients.
5. Collection and delivery of securities to the clients:
Collection of deliveries of securities from clients shall normally be called from the clients on T+1 basis.
In case of delivery pay-in obligations of large quantity/value and/or illiquid scrip shall be called for prior to the execution of sell order or as early as possible after the execution of sell order and shall be tendered to the clearing house under early pay-in mechanism.
Deliveries of securities to the clients shall be effected within 24 hours from the pay-out and as far as possible the deliveries shall be given to the clients directly from the clearing house through upload of pay-out break-up files.
In case of the clients who have given written authorization for retention of securities towards margin and/or future pay-in obligations, the pay-out securities of such clients shall be moved and retained in the separate BO account designated ‘Client Margin BO Account’.
6. Monitoring of Branches / Sub-Brokers etc.:
Monitoring of all clients shall be carried out centrally from Delhi Office.
7. Operations & Compliance Requirements:
The day to day operations are being looked after by the Compliance Officer. Maintenance of records.
The on-line surveillance desk is to be monitored by the Senior Officer where real time client wise/scrip wise position, MTM, margin requirements, available margin and exposure limits for all exchange segments are monitored.
Various types of limits on trading terminals are being set up and updated dynamically during the live market as off-line risk management reports are generated to enable a quick look at the status of any individual account or a group of accounts or for the clients.
The various compliance requirements of the exchange segments shall be ensured by the compliance officers under the supervision of the Senior Officer.
8. Continuity planning/alternate plan in case of disasters etc.:
The Senior Officer shall be in charge of all the Information Technology infrastructure requirements.
There shall be sufficient and competent man power to manage the trading system failures during the live market.
There shall be a back-up communication link in addition to the regular link for all the exchange segments and it shall be tested periodically.
There shall be a main line power input from two different routes and there shall be sufficient battery back-up through the on-line UPS. Apart from that there shall be a system to quickly switch over to the power back-up through the mobile generator van in case of long power failures.
In case of disaster, we can commence the operations from any of our two locations at any time since both locations have online connectivity. Moreover, we shall keep back-up zip, pen drive and cartridges with full data. All our data shall be loaded on our website which includes client transactions, contracts, ledgers, delivery statement etc., so we are well equipped in case of disaster.
9. Closure of client accounts/dormant accounts:
Clients who have not traded for more than 6 Months are treated as dormant accounts. Accounts may also be treated as dormant if the concerned officer deems fit. We have one specific form for re-activation of dormant accounts that must be duly filled by the client before trading is recommenced.
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