Securities and Exchange Board of India (SEBI)

The Securities and Exchange Board of India (SEBI) is the statutory regulator of the securities market in India, constituted by government resolution on 12 April 1988 and given statutory force from 30 January 1992 by the Securities and Exchange Board of India Act, 1992 (Act No. 15 of 1992), with its head office at Bandra Kurla Complex, Mumbai. It registers and supervises every securities market intermediary in the country, recognises the stock exchanges, makes the regulations that govern public issues, listed company disclosure, mutual funds and derivatives, and enforces them through investigation, adjudication and directions. Its chairman since 1 March 2025 is Tuhin Kanta Pandey.

SEBI’s mandate is set out in the preamble to the SEBI Act and repeated as a duty in Section 11(1): to protect the interests of investors in securities, to promote the development of the securities market, and to regulate the securities market. Those three objectives are in tension often enough that most of SEBI’s contested decisions can be read as a choice among them. The October 2024 derivatives package, which raised the minimum index options contract value to Rs 15 lakh, is the clearest recent example: it protected retail investors by pricing many of them out of a market the exchanges wanted developed.

The regulator funds itself. In FY2025-26 SEBI drew Rs 3,045.8 crore of funds against Rs 1,928.8 crore of expenditure, of which Rs 2,562.7 crore came from fees paid by the entities it regulates, with regulatory fees from stock exchanges alone contributing Rs 1,349.3 crore (SEBI Annual Report 2025-26, Tables 13.12 and 13.13). On 31 March 2026 its registers carried 4,721 stock brokers, 981 investment advisers, 1,826 research analysts, 54 mutual funds and 12,199 foreign portfolio investors, supervised by a staff of 1,105.

This article covers the statutes SEBI acts under, the composition of its board, the four categories of power it exercises, the penalties it can impose, the regulations it administers, its role in the market infrastructure, the reform programme from 2024 to 2026, its enforcement record, the appeal route to the Securities Appellate Tribunal, and the grievance route open to a retail investor.

Table: Key facts on SEBI, as on 20 September 2026.

Statutory basis and mandate

SEBI exercises no power that a statute has not given it. Three Acts supply them. The SEBI Act 1992 governs the regulator itself, the registration of intermediaries, investigation, adjudication and directions. The Securities Contracts (Regulation) Act 1956 governs the recognition of stock exchanges, the statutory definition of a security and of a derivative, and listing conditions, with the central government’s powers under that Act delegated to SEBI. The Depositories Act 1996 governs NSDL and CDSL and the dematerialised holding of securities that makes exchange settlement possible.

Section 3 of the SEBI Act constitutes SEBI as a body corporate with perpetual succession, capable of suing and being sued, which is why it is a statutory authority rather than a department of the Ministry of Finance. Section 11 states the duty and supplies the general powers. Section 12 makes registration compulsory for an intermediary. Section 11C provides the investigation power, Section 15-I the adjudication power, and Sections 11(4), 11B and 11D the power to issue directions. Section 14 creates the SEBI General Fund, credited with the fees SEBI collects, which is what allows it to operate without an annual appropriation.

Accountability runs to Parliament through the Ministry of Finance rather than through ministerial control of decisions. Section 16 allows the central government to issue written policy directions that bind SEBI, on questions of policy and not on an individual case. Section 18 allows the government to supersede the board. Section 31 requires every regulation SEBI makes to be laid before both Houses of Parliament, which may modify or annul it. Section 15Y bars a civil court from entertaining a suit in respect of any matter an adjudicating officer or the Securities Appellate Tribunal is empowered to decide.

Founding, 1947 to 1992

SEBI exists because the regime it replaced rationed capital rather than regulating a market. Under the Capital Issues (Control) Act 1947 , the Controller of Capital Issues in the Ministry of Finance sanctioned every public issue above a threshold and fixed its price, its size and its timing. The office controlled the supply of new securities. It did not supervise trading, broker conduct or continuing disclosure, and it had no surveillance capability. The fixed-price model it enforced also produced a standing transfer of value: popular issues were priced below what the market would pay, were oversubscribed many times, and listed at a premium that accrued to whoever received an allotment.

The 1988 non-statutory body

The Government of India constituted SEBI by administrative resolution on 12 April 1988, with S. A. Dave as its first chairman. In that form SEBI could issue guidelines and persuade. It could not make a binding regulation, register an intermediary, compel the production of a document or impose a penalty. Its early work was a code of conduct for merchant bankers and the groundwork for mutual fund regulation, which arrived as the SEBI (Mutual Funds) Regulations 1993 and was replaced by the SEBI (Mutual Funds) Regulations 1996 .

The 1992 securities scam and the SEBI Act

The fraud run by the stockbroker Harshad Mehta, which broke publicly in April 1992, converted a persuasive body into a statutory one. Mehta and his associates used bank receipts issued against government securities transactions that had not taken place to draw short-term funds out of the inter-bank market and into equities. The committee appointed by the Reserve Bank of India under R. Janakiraman in April 1992 put the diversion at about Rs 4,025 crore. The 1992 securities scam exposed a structural gap rather than a failure of enforcement: no regulator held a mandate to watch money moving between the banking system and the equity market at the same time.

The Securities and Exchange Board of India Act 1992 received Presidential assent on 4 April 1992 and took effect from 30 January 1992. It gave SEBI the rule-making power in Section 30, the registration power in Section 12, the investigation power in Section 11C, and a fund of its own under Section 14. The Capital Issues (Control) Act 1947 was repealed the same year, ending price control over public issues and replacing it with the disclosure-based regime the SEBI (ICDR) Regulations 2018 now carry. SEBI issues observations on a draft offer document; it does not approve the price, and it does not certify the issue as sound.

The board

Section 4(1) of the SEBI Act 1992 fixes the board at nine members: a chairman; two members from among the officials of the ministry dealing with finance and the administration of the Companies Act; one member from among the officials of the Reserve Bank; and five other members appointed by the central government, of whom at least three must be whole-time. Section 4(5) requires the chairman and the whole-time members to be persons of ability, integrity and standing with special knowledge of law, finance, economics, accountancy or administration. Section 5 sets a term of five years, renewable once, with retirement at 65 for the chairman and 62 for a whole-time member, and Section 6 sets the grounds for removal.

As on 31 March 2026 the board comprised chairman Tuhin Kanta Pandey; whole-time members Amarjeet Singh, Kamlesh Chandra Varshney and Sandip Pradhan; part-time member N. Venkatram; Deepti Gaur Mukerjee, Secretary of the Ministry of Corporate Affairs, and Anuradha Thakur, Secretary of the Department of Economic Affairs, as the two government nominees; and Shirish Chandra Murmu, Deputy Governor of the Reserve Bank of India , as the RBI nominee (SEBI Annual Report 2025-26). SEBI’s board members page on 20 September 2026 listed three whole-time members: Kamlesh Chandra Varshney, Sandip Pradhan and K.V.R. Murty, who took charge under press release PR No. 24/2026 dated 15 April 2026. Ananth Narayan G., who signed the Jane Street interim order of 3 July 2025, demitted office during FY2025-26.

The chairman and the whole-time members carry the executive load. A whole-time member signs orders under Sections 11(4), 11B and 11D in their own name, which is why a SEBI direction order carries a reference of the form WTM followed by the member’s initials. Adjudication orders are signed by an adjudicating officer appointed under Section 15-I, who is a SEBI officer and not a board member. The board itself meets to approve regulations and policy: the 212th meeting approved the SEBI (Mutual Funds) Regulations 2026, and the 214th meeting of 19 June 2026 (press release PR No. 33/2026) approved the re-introduction of open market buy-backs through the stock exchanges, a quick transmission processing route for small-value claims, and a code of conduct for members of SEBI itself.

Chairmen of SEBI

Table: Chairmen of SEBI since 1988. Source: SEBI.

Madhabi Puri Buch took office on 2 March 2022 and was the first woman to chair SEBI. Tuhin Kanta Pandey took charge on 1 March 2025 under press release PR No. 10/2025. A 1987-batch Indian Administrative Service officer, he was Finance Secretary and Secretary of the Department of Investment and Public Asset Management before the appointment, having overseen the sale of Air India and the listing of the Life Insurance Corporation of India.

Departments, offices and staff

SEBI employed 1,105 people on 31 March 2026, of whom 1,004 worked at the head office and 95 across the regional offices (SEBI Annual Report 2025-26, Table 13.6). For a regulator supervising 4,721 brokers, 54 mutual funds and over 12,000 foreign portfolio investors, that headcount is the binding constraint on how much of the market can be inspected directly rather than through the exchanges and depositories acting as first-level regulators.

The head office is SEBI Bhavan at Bandra Kurla Complex, Mumbai, with three further Mumbai premises. Four regional offices cover the country: Northern at Delhi, Eastern at Kolkata, Southern at Chennai and Western at Ahmedabad. The Annual Report 2025-26 records a single local office, at Indore, under the Western Regional Office. SEBI’s own directory lists 37 departments, offices and cells, a set that mixes operating departments with cells and the National Institute of Securities Markets.

Table: Principal SEBI departments and their remits. Source: SEBI departments and divisions directory, September 2026.

Statutory powers

SEBI exercises four distinct powers under the SEBI Act 1992, and the difference between them decides what a respondent faces and where the appeal goes. It makes regulations under Section 30. It investigates under Section 11C. It adjudicates and imposes monetary penalties under Sections 15A to 15HB read with Section 15-I. It issues directions, including impounding, disgorgement and debarment, under Sections 11(4), 11B and 11D. The first is legislative, the second inquisitorial, and the last two are the two separate enforcement tracks that are frequently confused with each other.

Rule-making

Section 30 of the SEBI Act 1992 empowers SEBI to make regulations on any matter for which the Act provides, without prior government approval, subject to publication in the Official Gazette and to being laid before Parliament under Section 31. SEBI has made more than sixty sets of regulations since 1992, from the SEBI (Stock Brokers) Regulations 1992 to the SEBI (Mutual Funds) Regulations 2026.

Below the regulations sit circulars, which carry the operational detail and change far more often. A circular is issued under Section 11(1) of the SEBI Act read with the enabling clause of the relevant regulation, and it binds the entities it addresses. SEBI consolidates circulars by subject into master circulars, reissued periodically, so that a broker or an AMC reads one current document rather than a decade of amendments. A SEBI circular number carries its issuing department and year, as in SEBI/HO/MRD/TPD-1/P/CIR/2024/132, which is a Market Regulation Department circular of 2024.

Investigation

Section 11C allows SEBI to appoint an investigating authority where it has reasonable ground to believe that transactions are being dealt with in a manner detrimental to investors, or that an intermediary has contravened the Act. The investigating authority may require any person to produce books, registers and records, and may examine any person on oath. Section 11(3) gives SEBI the powers of a civil court under the Code of Civil Procedure 1908 for discovery, production of documents and summoning witnesses. Section 11(2A) allows SEBI to call for information from any person, including banks and authorities outside its registration net.

SEBI took up 224 investigations in FY2025-26 and completed 204, with insider trading accounting for 221 of the cases taken up. Separately it took up 121 cases of fraudulent and unfair trade practices and completed 94 (SEBI Annual Report 2025-26, Tables 10.4 and 10.5). SEBI has no power to intercept communications. Its evidence comes from exchange and depository trade data, call data records obtained through the prescribed legal route, bank records called for under Section 11(2A), and information from the Enforcement Directorate, the Income Tax Department and the Financial Intelligence Unit. For cross-border cases it uses the IOSCO Multilateral Memorandum of Understanding.

Adjudication and penalties

An adjudicating officer appointed under Section 15-I holds an inquiry and may impose a monetary penalty for the contraventions listed in Sections 15A to 15HB. Section 15J requires the officer to have regard to three factors when fixing the amount: the disproportionate gain or unfair advantage made, the loss caused to investors, and the repetitive nature of the default. The Securities Laws (Amendment) Act 2014 removed the discretion to impose no penalty at all for several provisions by fixing statutory minimums.

Table: Penalties under the SEBI Act 1992, as amended by the Securities Laws (Amendment) Act 2014. Source: SEBI Act 1992, Sections 15A to 15HB.

SEBI passed adjudication orders against 640 entities in FY2025-26, against 1,293 entities the previous year. The penalties levied by adjudicating officers ran to Rs 23.9 crore against 233 entities for fraudulent and unfair trade practices, Rs 1.4 crore against 12 entities for insider trading, Rs 0.3 crore against 10 entities for disclosure violations, and Rs 9.9 crore against 254 entities for other violations (SEBI Annual Report 2025-26, Tables 10.18 and 10.19). The gap between the statutory maximum of Rs 25 crore and an average adjudication penalty in the low tens of lakhs is the single most useful number for understanding how SEBI enforcement actually works: the deterrent in practice is debarment and disgorgement, not the fine.

Directions, impounding and disgorgement

Sections 11(4) and 11B allow SEBI to issue directions in the interests of investors or the securities market, including suspending trading in a security, restraining a person from accessing the securities market, impounding proceeds, and directing disgorgement of unlawful gains. Section 11D allows SEBI to prohibit an insider from dealing. The power to direct disgorgement was placed beyond argument by an explanation inserted by the Securities Laws (Amendment) Act 2014, which also gave SEBI the power under Section 11(4) to attach bank accounts and under Section 28A to recover amounts as arrears of land revenue.

A direction order can issue ex parte and before any inquiry concludes, which makes it the fastest instrument SEBI holds. The interim order in the Jane Street matter is the working example: SEBI impounded Rs 4,843.57 crore on 3 July 2025 and lifted the market access restraint on compliance with that deposit, without adjudicating any penalty at all.

Recovery is the weak link. SEBI had generated 8,099 recovery certificates as on 31 March 2026, of which 3,394 were active and 942 were classified as difficult to recover, and it recovered Rs 340.8 crore during FY2025-26 (SEBI Annual Report 2025-26, Tables 10.21 and 10.22). Cumulatively since 1992, courts have decided 1,094 prosecution cases arising from SEBI complaints, producing 295 convictions and 405 compounded matters (Table 10.31).

Settlement

The SEBI (Settlement Proceedings) Regulations 2018 let a person against whom proceedings have been or may be initiated apply to settle them, without admitting or denying the findings of fact and conclusions of law. The settlement amount is computed under a formula in the regulations that weights the alleged violation and the entity type, and a settlement order is published. Defaults involving serious market abuse are excluded from the route.

In FY2025-26 SEBI received 439 settlement applications, disposed 170 by order, rejected, returned or saw withdrawn 199, and carried 499 into the following year, collecting Rs 109.82 crore in settlement amounts plus Rs 11.29 crore towards disgorgement (SEBI Annual Report 2025-26, Table 10.32). The comparative shows how uneven the flow is: FY2024-25 brought 703 applications and Rs 798.9 crore. SEBI also ran two thematic settlement schemes that concluded in March 2026, one for venture capital funds settling 29 entities for Rs 1.99 crore by order dated 9 March 2026, and one for persons who had associated with certain algorithmic trading platforms, settling 111 entities for Rs 1.11 crore by order dated 17 March 2026 (Table 10.33).

The standing criticism of the mechanism is that a settlement converts an enforcement question into a price. SEBI’s answer is throughput: the 640 adjudication orders and 204 completed investigations of FY2025-26 are the capacity of a 1,105-person organisation, and every matter settled is capacity released.

Who must register with SEBI

Section 12 of the SEBI Act 1992 makes it unlawful to act as a stock broker, share transfer agent, banker to an issue, trustee of a trust deed, registrar to an issue, merchant banker, underwriter, portfolio manager, investment adviser or other intermediary associated with the securities market without a certificate of registration from SEBI. Registration is not a formality: it carries net worth, qualification, certification, disclosure and inspection obligations under the regulations for each category, and SEBI may suspend or cancel it.

Table: SEBI-registered intermediaries on 31 March 2026. Source: SEBI Annual Report 2025-26, Tables 4.37, 5.1 and 6.2.

The registered population moves with the regulation applied to it. Alternative investment funds rose from 1,526 to 1,829 in a year, with commitments of Rs 16,94,262 crore. Mutual funds rose from 46 to 54 as the MF Lite route opened. Foreign portfolio investors rose 2.8 per cent to 12,199 while their assets under custody fell 5.7 per cent to Rs 69,57,108 crore, with United States investors accounting for 3,602 registrations and 40.7 per cent of those assets. A registered investment adviser population of 981 against 22.5 crore demat accounts is the clearest measure of how thin India’s regulated advice layer is, and it is the gap the unregistered advice market grew into.

Before paying money to anyone claiming to be an intermediary, an investor can check the registration on SEBI Check at siportal.sebi.gov.in and confirm that the payment collection handle is a validated UPI ID.

Regulations SEBI administers

SEBI’s regulations are the operative law of the Indian securities market, and a market participant deals with the regulations far more often than with the Act. The set below covers the ones a retail investor is most likely to encounter.

Table: Principal regulations administered by SEBI, September 2026.

Public issues

The SEBI (ICDR) Regulations 2018 , notified on 11 September 2018, govern every public issue of equity. A company files a draft red herring prospectus with SEBI through a merchant banker, SEBI issues observations, and the red herring prospectus is filed with the Registrar of Companies before the issue opens. Eligibility runs through a profitability route or, failing it, a route requiring at least 75 per cent allotment to qualified institutional buyers. Pricing is by book building within a band, with an anchor investor portion allotted a day before the issue opens, and allotment is split across qualified institutional, non-institutional and retail categories. Applications are funded through ASBA , which blocks money in the applicant’s own bank account rather than moving it, and small and medium enterprises use the separate SME IPO platforms. The full mechanics are in the article on the initial public offering .

Listed company obligations

The SEBI (LODR) Regulations 2015 carry the obligations that attach after listing: quarterly financial results, immediate disclosure of price sensitive events, an annual corporate governance report, board composition and committee requirements, and approval thresholds for related party transactions. The LODR regime and the SEBI (PIT) Regulations 2015 interlock, because the same event that triggers a LODR disclosure obligation is usually unpublished price sensitive information until it is disclosed.

Mutual funds

SEBI replaced the SEBI (Mutual Funds) Regulations 1996 with the SEBI (Mutual Funds) Regulations 2026, notified on 15 January 2026 under F. No. SEBI/LAD-NRO/GN/2026/294 and in force from 1 April 2026. This is the largest single change to Indian mutual fund regulation since 1996, and it was approved at SEBI’s 212th board meeting after a consultation paper of October 2025. Every Indian mutual fund remains a trust with a separate asset management company and a board of trustees owing a fiduciary duty to unitholders, supervised by SEBI’s Investment Management Department , but the charging structure changed.

Regulation 67 of the 2026 regulations defines the total expense ratio as the sum of the base expense ratio, brokerage cost, transaction cost and statutory levies, and bars any other charge beyond those and the exit load. Regulation 66(7)(c) sets the base expense ratio slabs.

Table: Base expense ratio caps in per cent, open-ended schemes, effective 1 April 2026. Source: Regulation 66(7)(c), SEBI (Mutual Funds) Regulations 2026.

Two further limits matter to a unitholder’s actual cost. Regulation 66(9) caps the brokerage chargeable above the base expense ratio at 0.06 per cent of trade value for cash market transactions and 0.02 per cent for derivatives, down from 0.12 per cent and 0.05 per cent under the 1996 regime. Regulation 66(10) places exchange, clearing corporation and clearing house levies outside the base expense ratio as transaction costs. Regulation 66(8) caps a fund of funds at twice the weighted average base expense ratio of the schemes it holds. SEBI followed the regulations with a circular on categorisation and rationalisation of mutual fund schemes dated 26 February 2026, and the 214th board meeting of 19 June 2026 approved further amendments covering scheme borrowing and a board-approved borrowing policy.

Two adjacent frameworks opened the industry at both ends. MF Lite , notified by amendment SEBI/LAD-NRO/GN/2024/221 dated 16 December 2024 and operationalised by circular SEBI/HO/IMD/PoD2/P/CIR/2024/183 dated 31 December 2024 with effect from 16 March 2025, relaxes net worth, track record and profitability requirements for an entity that will run only passive schemes. Specialised investment funds , introduced by circular SEBI/HO/IMD/IMD-PoD-1/P/CIR/2025/26 dated 27 February 2025 under Chapter VI-C of the 1996 regulations and in force from 1 April 2025, sit between a mutual fund and a portfolio management service, with a minimum investment of Rs 10 lakh per investor at PAN level across all strategies of the fund, waived for an accredited investor, and a sponsor requirement of average assets under management of at least Rs 10,000 crore.

The industry those rules govern held Rs 73,73,377 crore of net assets across 27,39,34,259 folios on 31 March 2026, held by 6,14,05,970 unique investors, up 13.2 per cent in a year (SEBI Annual Report 2025-26, Tables 5.8 and 5.9). The wider picture is in the article on mutual funds in India .

Market infrastructure

SEBI regulates the market infrastructure institutions that stand between a retail order and a settled trade: the exchanges, the clearing corporations and the depositories. Each is a first-level regulator in its own right, which is how a staff of 1,105 supervises a market with 22.5 crore demat accounts.

Exchanges

Stock exchanges are recognised under Section 4 of the Securities Contracts (Regulation) Act 1956 and governed by the SEBI (SECC) Regulations 2018 , which set ownership limits, fit and proper requirements, governance standards and the obligation to run surveillance. The National Stock Exchange and the Bombay Stock Exchange are the two national exchanges; the Nifty 50 and the Sensex are their benchmark indices. Exchanges set circuit limits and price bands , operate the additional surveillance measure and the graded surveillance measure , and refer alerts to SEBI’s Integrated Surveillance Department. Regulatory fees from exchanges, at Rs 1,349.3 crore in FY2025-26, are SEBI’s largest single source of income.

Depositories and clearing corporations

NSDL and CDSL hold every listed security in dematerialised form under the Depositories Act 1996, reaching investors through 887 registered depository participants . They jointly carried 22.5 crore demat accounts at the end of FY2025-26, of which 18.8 crore were opened after April 2020, representing 12.18 crore unique accounts after removing investors holding with both depositories (SEBI Annual Report 2025-26, Table 4.6). Clearing corporations, principally NSE Clearing and the Indian Clearing Corporation, act as the central counterparty to every exchange trade and guarantee settlement, which is why a broker default does not become a counterparty default for the client. The custody layer is regulated separately under the SEBI custodian framework , and unit-level records for mutual funds sit with a registrar and transfer agent .

Reform programme, 2024 to 2026

The reform programme SEBI ran between October 2024 and April 2026 has one organising theme: retail participation had grown faster than the protections around it, and SEBI raised the cost of the activities where the loss data was worst. The derivatives package, the algorithmic trading framework, the association ban on unregistered advice and the validated payment handle all point the same way.

Index derivatives, October 2024

By circular SEBI/HO/MRD/TPD-1/P/CIR/2024/132 dated 1 October 2024, titled “Measures to Strengthen Equity Index Derivatives Framework for Increased Investor Protection and Market Stability”, SEBI imposed six measures on the index derivatives segment with staggered effective dates.

Table: The six measures of the equity index derivatives framework. Source: SEBI circular SEBI/HO/MRD/TPD-1/P/CIR/2024/132 dated 1 October 2024.

The contract value limit had last been set in 2015, at the Rs 5 lakh to Rs 10 lakh band. Tripling it was the measure that bound: it raised the margin a retail participant needs for a single short option position by roughly the same multiple, which is the mechanism by which the F&O entry barrier rules removed the smallest accounts from the segment. The tax side moved in parallel, with the securities transaction tax on options selling rising from 0.0625 per cent to 0.1 per cent from 1 October 2024, and the true-to-label charges framework ending volume rebates on the same date. What the reform means for a trader’s own position sizing is covered in equity derivatives in India .

Expiry day standardisation, May 2025

By circular SEBI/HO/MRD/MRD-TPD-1/P/CIR/2025/76 dated 26 May 2025, SEBI required every exchange to settle all its equity derivatives contracts on either Tuesday or Thursday, and to seek SEBI’s prior approval before changing that day. One weekly benchmark index options contract is permitted per exchange on its chosen day. Every other equity derivatives contract, including benchmark index futures, non-benchmark index contracts and single stock contracts, carries a minimum tenor of one month and expires in the last week of the month on the chosen day. Exchanges were to submit their proposals by 15 June 2025. The circular fixes the two permitted days; it does not itself assign a day to a named exchange.

Position limits on a future-equivalent basis

SEBI moved index options position limits from a notional basis to a delta-weighted future-equivalent (FutEq) basis over 2025. Paragraph 5.5 of circular SEBI/HO/MRD/TPD-1/P/CIR/2025/79 dated 29 May 2025 set end-of-day limits at net FutEq Rs 1,500 crore and gross FutEq Rs 10,000 crore, on a glide path from 1 July 2025 with normal implementation from 6 December 2025. Circular SEBI/HO/MRD/TPD/CIR/P/2025/122 dated 1 September 2025 then set intraday limits for index options at net FutEq Rs 5,000 crore and gross FutEq Rs 10,000 crore per entity, monitored through at least four random snapshots a day including one between 14:45 and 15:30, with a penalty or an additional surveillance deposit for an expiry-day breach. SEBI’s stated reason was observed instances of outsized intraday future-equivalent positions built by certain entities in index options on expiry day, which is the conduct the Jane Street order describes.

Settlement cycle

Indian equities settle on T+1, completed in January 2023, and an optional same-day cycle sits alongside it. By circular SEBI/HO/MRD/MRD-PoD-3/P/CIR/2024/172 dated 10 December 2024, SEBI extended the optional T+0 settlement cycle, which had run as a beta with 25 scrips from 28 March 2024, to the top 500 scrips by market capitalisation as on 31 December 2024, phased in from the bottom 100 of those 500 with 100 more added each month. All stock brokers may participate and may charge different brokerage for the T+0 and T+1 cycles, and qualified stock brokers were required to build the systems needed to participate, a deadline SEBI extended by a further circular in April 2025. Optional instant settlement, floated in the consultation paper of December 2023, remains at consultation stage: no implementing circular has been issued. The cycle history is set out in T+1 settlement and the 2025-26 settlement changes .

Algorithmic trading by retail investors

By circular SEBI/HO/MIRSD/MIRSD-PoD/P/CIR/2025/0000013 dated 4 February 2025, titled “Safer participation of retail investors in Algorithmic trading”, SEBI brought retail algorithmic trading through broker application programming interfaces inside a registration and accountability framework. Implementation slipped three times. A circular of 29 July 2025 moved the effective date from 1 August 2025 to 1 October 2025, and circular SEBI/HO/MIRSD/MIRSD-PoD/P/CIR/2025/132 dated 30 September 2025 set three milestones: algo products applied for exchange registration by 31 October 2025, registration completed by 30 November 2025, and participation in a mock session by 3 January 2026. Brokers that missed them were barred from onboarding new retail clients for API-based algo trading from 5 January 2026, and the framework applies in full from 1 April 2026.

Validated UPI handles and SEBI Check

From 1 October 2025, every SEBI-registered investor-facing intermediary collects money from investors only through a UPI ID on the exclusive @valid handle issued by NPCI, under circular SEBI/HO/DEPA-II/DEPA-II_SRG/P/CIR/2025/86 dated 11 June 2025 and announced as live by press release PR No. 64/2025. The handle combines the intermediary’s self-certified name with a category suffix and the bank, giving forms such as abc.brk@validhdfc for a broker and xyz.mf@validicici for a mutual fund. A payment to a validated handle displays a thumbs-up inside a green triangle in the payer’s app, and the absence of that mark is the warning sign. SEBI states that on the launch date brokers covering over 90 per cent of investors, and all mutual funds, had adopted it. The companion tool, SEBI Check at siportal.sebi.gov.in, confirms that a UPI ID or bank account belongs to a registered intermediary before money moves. Anyone unfamiliar with the payment rail should read unified payments interface first.

SEBI separately approved, at its board meeting of October 2024, a requirement that qualified stock brokers offer their clients either the UPI block facility for the cash segment, which blocks money in the client’s own account in the way ASBA does for a public issue, or a three-in-one trading account, with effect from 1 February 2025. The choice remains the client’s.

Association with unregistered advice

By circular SEBI/HO/MIRSD/MIRSD-PoD-1/P/CIR/2024/143 dated 22 October 2024, SEBI barred every person it regulates, including recognised stock exchanges, clearing corporations, depositories and their agents, from any direct or indirect association with a person who gives advice or recommendations on securities without SEBI registration or permission, or who makes any claim of returns or performance without SEBI’s permission. The circular operationalises three amendment regulations notified on 26 August 2024, covering intermediaries, exchanges and clearing corporations, and depositories.

The ban is on the commercial relationship rather than on the speech: a broker may not pay, refer, or share revenue with an unregistered advice channel. The carve-out is the “specified digital platform”, a platform SEBI has specified as having preventive and curative mechanisms to its satisfaction, and a further carve-out covers persons engaged in investor education subject to conditions. SEBI issued a clarification circular in January 2025. The effect on referral arrangements is covered in the finfluencer ban and broker referrals .

Insider trading: the 2025 amendment

The SEBI (Prohibition of Insider Trading) (Amendment) Regulations 2025, F. No. SEBI/LAD-NRO/GN/2025/235, made on 11 March 2025, published on 12 March 2025 and in force on the ninetieth day from publication, widened the definition of unpublished price sensitive information in Regulation 2(1)(n) by inserting eleven new sub-clauses. The additions bring within UPSI: a change of credit rating other than an ESG rating, a proposed fund raising, an agreement affecting management or control, fraud or default by the company or its promoter, director, key managerial personnel or subsidiary, a resolution plan or one-time settlement on borrowings, admission of a winding-up or insolvency petition, initiation of a forensic audit and receipt of its final report, regulatory or enforcement action in India or abroad, the outcome of material litigation, guarantees or indemnities outside the normal course of business, and the grant, withdrawal or suspension of a key licence. The amendment also allows entry of externally sourced information into the structured digital database up to two calendar days from receipt.

The practical consequence for a listed company is that the trading window now closes on a far wider set of events. The proposal to rationalise the definition of “connected person”, floated in a consultation paper of July 2024, has not been notified.

Research analysts

By circular SEBI/HO/MIRSD/MIRSD-PoD1/P/CIR/2025/004 dated 8 January 2025, SEBI set the deposit a research analyst must maintain under Regulation 8, scaled to the maximum number of clients on any day of the previous financial year: Rs 1 lakh up to 150 clients, Rs 2 lakh for 151 to 300, Rs 5 lakh for 301 to 1,000, and Rs 10 lakh for 1,001 and above. The deposit sits with a scheduled bank under lien in favour of the Research Analyst Administration and Supervisory Body, and existing analysts had to comply by 30 April 2025. SEBI followed with most important terms and conditions for research analysts in February 2025 and a master circular in June 2025. The boundary between a research analyst and an investment adviser, which decides which of the two regimes applies, is set out in research analyst versus investment adviser .

Enforcement record

SEBI’s enforcement history is best read as a sequence of structural gaps closed after the event. Each of the cases below changed a rule, and in several instances created a market institution that had not existed before.

Jane Street, 2025

By interim ex parte order WTM/AN/MRD/MRD-SEC-3/31516/2025-26 dated 3 July 2025, signed by whole-time member Ananth Narayan G., SEBI impounded Rs 4,843.57 crore of alleged unlawful gains from four Jane Street entities, JSI Investments, JSI2 Investments, Jane Street Singapore and Jane Street Asia Trading, and restrained them from accessing the securities market. The order was passed under Sections 11(1), 11(4), 11B(1) and 11D of the SEBI Act 1992. SEBI described two strategies concentrated on expiry days in BANKNIFTY and NIFTY contracts: an intraday index manipulation strategy and an expiry-day closing-price strategy. The impounded sum was to be deposited in an escrow account with a lien in favour of SEBI, and clause 62.11 of the order provides that the market access restraints cease on compliance with that direction. SEBI published two updates on compliance with the order in July 2025.

The order is the largest impounding SEBI has ordered and it is the direct antecedent of the intraday future-equivalent position limits of 1 September 2025, which target precisely the expiry-day position building the order describes.

The historical cases

The 1992 securities scam produced the SEBI Act itself, the Special Court under the Special Courts (Trial of Offences Relating to Transactions in Securities) Act 1992, and the move to depository settlement that ended physical share transfer.

The Ketan Parekh manipulation of 1999 to 2001 used credit from cooperative banks to support a basket of technology, media and telecommunications stocks. SEBI debarred Parekh from the securities market and the episode produced security-level circuit breakers and limits on broker borrowing against client securities.

The Satyam Computer Services fraud , admitted by chairman B. Ramalinga Raju in January 2009, set the boundary of SEBI’s jurisdiction. SEBI could act on disclosure and market integrity; the accounting fraud itself went to the Serious Fraud Investigation Office and the Institute of Chartered Accountants of India.

The Sahara OFCD case established that an issue to more than 49 persons is a public issue whatever it is called. The Supreme Court upheld SEBI’s jurisdiction in 2012 and directed the Sahara entities to deposit funds with SEBI for refund to investors, a refund process that has run for more than a decade.

The NSEL payment default of 2013 was a regulatory gap rather than a SEBI failure: a spot exchange fell outside SEBI’s remit. It contributed to the merger of the Forward Markets Commission into SEBI on 28 September 2015 under the Securities Laws (Amendment) Act 2014, after which SEBI regulates all exchange-traded derivatives, including commodities.

The NSE co-location case concerned preferential access to the exchange’s tick-by-tick data feed and produced disgorgement orders and governance directions against the exchange. The Karvy Stock Broking pledge misuse of 2019, in which client securities were pledged to raise funds for the broker, produced the September 2020 margin pledge rules that made a pledge visible in the client’s own demat account.

Appeals: the Securities Appellate Tribunal

An appeal against a SEBI order lies to the Securities Appellate Tribunal within 45 days of receiving the order, under Section 15T of the SEBI Act 1992. SAT is a statutory tribunal, sitting at Mumbai, that also hears appeals from orders of the Insurance Regulatory and Development Authority of India and the Pension Fund Regulatory and Development Authority. It is headed by a presiding officer who has been a judge of the Supreme Court or a chief justice of a High Court. A further appeal lies to the Supreme Court within 60 days, on a question of law arising out of the SAT order, under Section 15Z.

The queue is the practical constraint. SEBI carried 960 appeals pending before SAT at the start of FY2025-26, with 429 more filed during the year (SEBI Annual Report 2025-26, Table 10.35). Section 15Y bars a civil court from entertaining any suit in a matter that an adjudicating officer or SAT is empowered to determine, so the statutory appeal is in practice the only route.

Investor grievance redressal

A retail investor with a complaint against a SEBI-registered intermediary files it on the SCORES portal at scores.sebi.gov.in. The complaint goes to the entity concerned for redressal, then to a designated body such as the stock exchange for a broker complaint, and then to SEBI’s Office of Investor Assistance and Education. SEBI received 61,788 SCORES complaints in FY2025-26 and disposed 60,213, carrying 5,637 actionable complaints into the next year; 54,064 came in as e-complaints, 4,012 physically and 3,712 through the mobile app (SEBI Annual Report 2025-26, Table 8.2). A further 3,188 complaints arrived through the government’s CPGRAMS portal. The step-by-step route is in SCORES investor grievance .

SCORES handles complaints, not disputes. A dispute over money owed goes to the SMART ODR platform for conciliation and, failing that, arbitration, which produces an enforceable award rather than an administrative closure. The SEBI investor charter sets out the service standards an investor is entitled to expect, with a mutual-fund-specific version in the investor charter for mutual funds . Where a broker defaults outright, the exchange’s investor protection fund is the recourse, and for mutual funds the SEBI investor protection fund framework applies.

SEBI compared with the other financial regulators

India divides financial regulation by product rather than by institution, which is why the same bank can face four regulators for four activities.

Table: The Indian financial sector regulators and their governing statutes.

The boundaries are not clean, and the contested areas recur: hybrid instruments that are debt in form and equity in substance, borrowing by foreign portfolio investors against Indian holdings, currency and interest rate derivatives traded on stock exchanges, and corporate bond repo. The Financial Stability and Development Council, chaired by the Union Finance Minister, is the standing coordination forum, and SEBI and the RBI also run bilateral coordination on foreign portfolio investment, where SEBI registers the investor and the RBI controls the capital account.

Compared with the US Securities and Exchange Commission

Table: SEBI and the US SEC compared.

The structural difference that matters is prosecution. Section 24 of the SEBI Act makes a contravention punishable with imprisonment of up to 10 years or a fine of up to Rs 25 crore, but SEBI files a complaint and the case runs in court: 1,094 such cases have been decided since 1992, yielding 295 convictions. A securities fraud in India is therefore punished quickly by debarment and slowly, if at all, by conviction.

Criticism

Three criticisms of SEBI are supported by its own published numbers rather than by assertion.

Recovery lags enforcement. SEBI recovered Rs 340.8 crore in FY2025-26 against 8,099 recovery certificates issued cumulatively, of which 942 are classified as difficult to recover. An order that is not collected is a deterrent only to the extent the debarment attached to it bites.

The settlement route prices enforcement. In FY2025-26 SEBI collected Rs 109.82 crore across 170 settlement orders, against Rs 798.9 crore the previous year. The variance year to year, driven by the size of the matters that happen to settle, is itself an argument that the amount reflects negotiating position as much as harm caused. SEBI’s defence is capacity: with 1,105 staff and 224 investigations a year, every settled matter releases resources.

Penalties are far below the statutory ceiling. The Rs 25 crore maximum in Sections 15G, 15H and 15HA is rarely approached. Adjudicating officers levied Rs 23.9 crore in total across 233 entities for fraudulent and unfair trade practices in FY2025-26, an average near Rs 10 lakh. Section 15J requires proportionality to gain and loss, which explains the individual figures, but the aggregate makes the point that the fine is not the operative sanction.

International engagement

SEBI is a member of the International Organisation of Securities Commissions and a signatory to the IOSCO Multilateral Memorandum of Understanding, which is the instrument through which it obtains beneficial ownership and trading information from foreign regulators in market abuse investigations. Cross-border cases are where its domestic powers stop: SEBI can summon an Indian custodian under Section 11(3), but the chain behind a foreign portfolio investor runs through jurisdictions where only the MMoU reaches. SEBI has also signed bilateral memoranda with several foreign securities regulators, and it participates in IOSCO committees and working groups alongside the Reserve Bank of India’s engagement with the Financial Stability Board.

See also

• SEBI Act 1992
• Securities Contracts (Regulation) Act 1956
• Capital Issues (Control) Act 1947
• Securities Appellate Tribunal
• How SEBI regulates Indian capital markets
• SEBI (ICDR) Regulations 2018
• SEBI ICDR summary
• SEBI DIP Guidelines 2000
• SEBI (LODR) Regulations 2015
• SEBI (Takeover) Regulations 2011
• SEBI (PIT) Regulations 2015
• SEBI (PFUTP) Regulations 2003
• SEBI (Mutual Funds) Regulations 1996
• SEBI (Mutual Funds) Regulations 1993
• SEBI (AIF) Regulations 2012
• SEBI (Investment Advisers) Regulations 2013
• SEBI (Research Analysts) Regulations 2014
• SEBI (PMS) Regulations 2020
• SEBI (SECC) Regulations 2018
• SEBI (Delisting) Regulations 2021
• SEBI (Stock Brokers) Regulations 1992
• SEBI (Merchant Bankers) Regulations 1992
• SEBI (Settlement Proceedings) Regulations 2018
• SEBI (EOP) Regulations 2023
• SEBI custodian framework
• SEBI specialised investment funds
• SEBI MF Lite regulations
• SEBI scheme rationalisation circular 2017
• SEBI mutual fund categorisation, October 2017
• SEBI multi-cap reclassification 2020
• SEBI mutual fund stress testing 2024
• SEBI mutual fund compliance audit
• SEBI mutual fund insider trading rules
• Insider trading rules for mutual funds
• SEBI investment management department
• SEBI margin pledge rules, September 2020
• SEBI F&O entry barrier rules 2024
• SEBI true-to-label charges, October 2024
• SEBI research analyst versus investment adviser
• SEBI turnover fee
• SEBI B30 and T30 classification
• SEBI SCORES
• SEBI SCORES investor grievance
• SEBI investor charter
• SEBI investor charter for mutual funds
• SEBI investor protection fund for mutual funds
• National Stock Exchange
• Bombay Stock Exchange
• NSE Clearing
• NSE co-location case
• NSDL
• CDSL
• Depository participant
• Dematerialisation
• Registrar and transfer agent
• Mutual fund custodian
• Nifty 50
• Sensex
• Circuit limits and price bands
• Additional surveillance measure
• Graded surveillance measure
• Reserve Bank of India
• AMFI
• Forward Markets Commission
• IOSCO
• Credit rating agencies in India
• 1992 securities scam
• Ketan Parekh manipulation case
• Satyam Computer Services fraud
• Sahara OFCD case
• National Spot Exchange Limited
• Karvy Stock Broking
• Initial public offering
• Red herring prospectus
• Book building
• Anchor investor
• ASBA
• SME IPO
• Demat account
• Stockbroker in India
• Mutual fund
• Mutual funds in India
• Mutual fund total expense ratio
• Systematic investment plan
• Alternative investment funds in India
• Portfolio management services
• Registered investment adviser in India
• Foreign portfolio investor
• Equity derivatives in India
• Derivatives trading
• Securities transaction tax
• F&O taxation in India
• T+1 settlement cycle
• Settlement cycle changes 2025-26
• Unified Payments Interface
• Income tax in India
• Finfluencer ban and broker referrals

External references

• Securities and Exchange Board of India
• SEBI board members
• SEBI Act 1992, as served by SEBI
• SEBI Annual Report 2025-26
• Measures to strengthen the equity index derivatives framework, 1 October 2024
• Final settlement day for equity derivatives contracts, 26 May 2025
• SEBI (Mutual Funds) Regulations 2026
• Regulatory framework for specialised investment funds, 27 February 2025
• SCORES investor complaint portal

References

1. Securities and Exchange Board of India Act, 1992 (Act No. 15 of 1992), Sections 3, 4, 11, 11B, 11C, 11D, 12, 14, 15A to 15HB, 15-I, 15J, 15T, 15Y, 15Z, 16, 18, 24, 28A, 30 and 31.
2. Securities Contracts (Regulation) Act, 1956 (Act No. 42 of 1956).
3. Depositories Act, 1996 (Act No. 22 of 1996).
4. Securities Laws (Amendment) Act, 2014.
5. SEBI Annual Report 2025-26, released 6 August 2026 under press release PR No. 43/2026. Tables 4.6, 4.37, 5.1, 5.8, 5.9, 6.2, 8.2, 10.4, 10.5, 10.18, 10.19, 10.21, 10.22, 10.31, 10.32, 10.33, 10.35, 13.6, 13.12 and 13.13.
6. SEBI press release PR No. 10/2025, dated 1 March 2025, on the assumption of charge by the chairman.
7. SEBI press release PR No. 24/2026, dated 15 April 2026, on the assumption of charge by a whole-time member.
8. SEBI press release PR No. 33/2026, dated 19 June 2026, on the 214th meeting of the SEBI board.
9. SEBI circular SEBI/HO/MRD/TPD-1/P/CIR/2024/132, dated 1 October 2024, “Measures to Strengthen Equity Index Derivatives Framework for Increased Investor Protection and Market Stability”.
10. SEBI circular SEBI/HO/MRD/MRD-TPD-1/P/CIR/2025/76, dated 26 May 2025, “Final Settlement Day (Expiry Day) for Equity Derivatives Contracts”.
11. SEBI circular SEBI/HO/MRD/TPD-1/P/CIR/2025/79, dated 29 May 2025, paragraph 5.5, on end-of-day future-equivalent position limits.
12. SEBI circular SEBI/HO/MRD/TPD/CIR/P/2025/122, dated 1 September 2025, “Framework for Intraday Position Limits Monitoring for Equity Index Derivatives”.
13. SEBI circular SEBI/HO/MRD/MRD-PoD-3/P/CIR/2024/172, dated 10 December 2024, on the optional T+0 settlement cycle for the top 500 scrips.
14. SEBI (Mutual Funds) Regulations, 2026, F. No. SEBI/LAD-NRO/GN/2026/294, notified 15 January 2026, in force 1 April 2026, Regulations 66 and 67.
15. SEBI notification SEBI/LAD-NRO/GN/2024/221, dated 16 December 2024, inserting the MF Lite chapter, and SEBI circular SEBI/HO/IMD/PoD2/P/CIR/2024/183, dated 31 December 2024.
16. SEBI circular SEBI/HO/IMD/IMD-PoD-1/P/CIR/2025/26, dated 27 February 2025, “Regulatory Framework for Specialized Investment Funds”.
17. SEBI circular SEBI/HO/MIRSD/MIRSD-PoD-1/P/CIR/2024/143, dated 22 October 2024, on association of regulated persons with persons engaged in prohibited activities.
18. SEBI (Prohibition of Insider Trading) (Amendment) Regulations, 2025, F. No. SEBI/LAD-NRO/GN/2025/235, published 12 March 2025.
19. SEBI circular SEBI/HO/MIRSD/MIRSD-PoD1/P/CIR/2025/004, dated 8 January 2025, “Guidelines for Research Analysts”.
20. SEBI circular SEBI/HO/MIRSD/MIRSD-PoD/P/CIR/2025/0000013, dated 4 February 2025, “Safer participation of retail investors in Algorithmic trading”, and SEBI circular SEBI/HO/MIRSD/MIRSD-PoD/P/CIR/2025/132, dated 30 September 2025, on its implementation milestones.
21. SEBI circular SEBI/HO/DEPA-II/DEPA-II_SRG/P/CIR/2025/86, dated 11 June 2025, on standardised and validated UPI IDs, and SEBI press release PR No. 64/2025 on the launch from 1 October 2025.
22. SEBI interim order WTM/AN/MRD/MRD-SEC-3/31516/2025-26, dated 3 July 2025, in the matter of index manipulation by the Jane Street Group.
23. SEBI (Settlement Proceedings) Regulations, 2018.