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Sebi introduces new system for verification in case of investor death

NEW DELHI: Sebi on Tuesday announced a centralised mechanism for reporting and verification through the KYC registration agency in case of an investor’s demise. It has put in place operational norms, including the obligations of regulated entities and registered intermediaries that have interfaces with investors or account holders who are natural persons.
The framework will come into effect from January 1, 2024, Sebi said. It said that listed companies wishing to provide beneficial access to such a centralised mechanism to their investors holding securities in physical form can establish connectivity with KRA through their RTAs.
After receiving intimation about the investor’s demise, the intermediary will have to obtain the death certificate along with the PAN from the notifier or nominee and verify the death certificate through online or offline mode. If the intermediary, after receiving information about the demise, is not in a position to obtain the death certificate, then it will have to inform the nominee that the KYC status of the deceased has been flagged off as “On Hold” and require them to furnish the death certificate of the investor.

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