Can’t allow any unverifiable way of doing business sebi chief

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Can’t allow any unverifiable way of doing business sebi chief

Mumbai, Sep 21 (PTI) Securities and Exchange Board of India (Sebi) Chairperson Madhavi Puri Buch on Wednesday said that any way of doing business which is based on ‘black box’ and which cannot be audited Nor can the verification be done, it will not be allowed.

He also said that ‘data’ is a public infrastructure and any attempt by any private entity or individual to take possession of it will not be tolerated.

A ‘black box’ is a device or system, which gives useful information without disclosing any of its internal workings. There is no explanation for its conclusions.

Addressing the Global Fintech Fest, Buch said, “We are not for or against algo trading, provided there is adequate transparency and disclosure. Business models cannot be based on ‘black box’… so any claim that cannot be audited or verified will not be allowed.”

There were reports that the market regulator may take action against Algo Trading.

Earlier this month, capital markets regulator SEBI had issued guidelines for brokers providing services related to algo trading to investors. The objective of this initiative is to curb the sale of shares by claiming ‘high returns’.

Securities and Exchange Board of India (SEBI) has observed that some stockbrokers are facilitating algorithmic based trading to investors through platforms outside the purview of regulation.

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