Market regulator SEBI on 15 December 2011 directed intermediaries not to outsource their core business activities and compliance functions.
According to SEBI, core business activities may include execution of orders and monitoring of trading activities of clients in case of stock brokers, dematerialisation of securities in case of depositary participants, investment-related activities in case of mutual funds and portfolio managers.
Intermediaries would be responsible for reporting any suspicious transactions to the Financial Intelligence Unit or other competent authority in respect of activities carried out by the third parties.
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