KFin Technologies pays SEBI ₹87.75 lakh to settle RTA rule violation case

KFin Technologies Ltd has paid ₹87.75 lakh to capital markets regulator SEBI to settle a case related to lapses in due diligence and non-compliance with regulatory requirements.

The regulator had undertaken the inspection of KFin Technologies for the period between February 1 and November 30, 2023.

The inspection report, communicated to the company in March 2024, alleged that KFin had failed “to exercise due diligence while processing the request for dematerialization of shares” in violation of the RTA (Registrar to an Issue and Share Transfer Agent) regulations.

SEBI found that the company had also failed to mark 17,98,534 folios not having PAN details and 17,75,683 folios without bank account details for enhanced due diligence.

A show-cause notice was issued to the company on July 8, 2024.

KFin filed a settlement application on August 19, 2024, requesting the regulator to settle the adjudication proceedings.

The Internal Committee of SEBI held multiple meetings with the company’s representatives between October 2024 and April 2025.

The committee computed an indicative settlement amount of ₹87.75 lakh, which was later recommended by the High Powered Advisory Committee at its meeting on June 5, 2025.

The proposal was finally approved by a panel of SEBI’s Whole Time Members on August 8, 2025.

As per the settlement order, the markets watchdog will not initiate enforcement proceedings against KFin Technologies for the violations.

In his order dated August 26, SEBI Adjudicating Officer Jai Sebastian said: “In view of the acceptance of the settlement terms and the receipt of the settlement amount by SEBI, the instant adjudication proceedings… are disposed of.”

However, the regulator made it clear that the settlement was “without prejudice to the right of SEBI to take actions” if any representation made during the proceedings was later found to be untrue or if the company breached the terms of the settlement.