SEBI Fines OPG Securities ₹5.2 Crore in NSE Co-location Matter

The Securities and Exchange Board of India (SEBI) has imposed a penalty of ₹5.2 crore on stockbroker OPG Securities and its directors in connection with the National Stock Exchange (NSE) co-location matter. The case relates to unfair access to NSE’s secondary market servers.

Breakdown of Penalty

SEBI issued a ₹5 crore fine on OPG Securities and its three directors – Sanjay Gupta, Sangeeta Gupta, and Om Prakash Gupta, jointly, citing engagement in unfair trade practices. An additional fine of ₹10 lakh each was imposed on OPG Securities and Sanjay Gupta for non-compliance with SEBI’s code of conduct and for obstructing the investigation.

Findings by SEBI

According to SEBI’s 25-page order, OPG Securities gained an unfair advantage by repeatedly connecting to NSE’s Secondary Point of Presence (POP) server. SEBI noted this as a recurrent and serious violation. The adjudicating officer stated that the conduct breached fair access norms and amounted to misuse of the co-location facility.

The directors were held vicariously liable as they were in charge of the company during the period when the violations occurred. SEBI also observed that the company failed to maintain the expected standards of integrity, due diligence, and compliance with statutory requirements.

Appeals and Past Developments

This is not the first penalty order in the matter. In February 2021, SEBI had passed a similar order imposing a ₹5.2 crore penalty. Following that, the matter was appealed to the Securities Appellate Tribunal (SAT), which in July 2023 directed SEBI to reconsider the quantum of penalty.

In September 2024, SEBI dropped charges against the NSE and its former officials due to lack of evidence. Meanwhile, OPG’s disgorgement amount was revised to ₹85 crore. Appeals in the SAT and Supreme Court are still pending.

SEBI’s Stand

SEBI clarified that the current order was limited to reassessing the penalty, not re-evaluating the violations. The request to delay the penalty process was rejected.

Conclusion

Despite pending appeals, SEBI has proceeded with reaffirming the penalty, stating that the violations have already been confirmed and due process has been followed.

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