Mumbai, June 14 (TIWN) The Securities Appellate Tribunal (SAT) has directed the SEBI to conduct an independent inquiry against five brokers and persons associated with the brokers, and probe their role in the Rs 5,600-crore NSEL payment default case afresh within six months.

In its recent order, the SAT noted serious allegations against five brokers - Motilal Oswal Commodities Broker Pvt Ltd, Anand Rathi Commodities Ltd, IIFL Commodities Ltd, Philip Commodities India Pvt Ltd, and Geofin Comtrade Ltd - of indulging in illegal activities such as funding of clients by way of PAN lending, name lending through their NBFC, and other related entities, and that funding was totally disproportionate to the net-worth and income level of these clients.  The SAT also observed that the brokers have misused their in-house NBFC and have funded clients who had no capacity to take such exposure. These brokers channelised funds for trading without permission and knowledge of the clients and were engaged in market capturing practices by large-scale unique client code modifications.