Authority Letter for Maintaining Running Account?

L

Logik

Active Member
#1
#1
Well, i received mail from indiabulls asking me to sign this new agreement, called "Authority Letter for Maintaining Running Account".

the mail is as below (inside quotes)

Dear Client,

This is to inform you that as per SEBI guidelines, the Running Account Authorization needs to be renewed on annual basis if you wish to continue availing the facility for maintaining a running account with us. You are,therefore, requested to send us a duly signed Running Account Authorization at the following address:

Kindly ensure that the signed running Account authorization reaches us latest by 15th of March, 2010 to avoid any inconvenience.

In case Running Account Authorization is not received by 15th Mar’10, the facility for running account authorization shall be withdrawn from your account & the settlements would be done on daily basis.

For your convenience Running Account Authorization Letter format has been attached with this mail.

Things to note:

1. The authorization shall be valid for one year only & needs to be renewed every 12 months.

2. Without Running Account Facility the settlement would be done on daily basis hence there would be no exposure on cash.

3. Running Account authorization can only be signed by the Account holder. POA Holder/Authorized Person cannot sign this document on your behalf.

4. Please note that the only hard copy of the authorization would be accepted for processing.
Click to expand...
I called Indiabulls & the guy told me if i don't sign this, they can't keep money in my trading accnt. they will have to transfer it to my bank accnt, as per new SEBI guidelines. so even if i need to trade intraday, i need to move money from my BANK to Trading accnt daily. this is funny.

i don't get it? any one facing the same situation?
 
M

[email protected]

New Member
#2
#2
Yes..
I too got a similar letter from Religare, they asked to to contact branch in person. I called them and asked abt it, a guy there in my branch said no need to worry about it. You can carry on with your trading acct as usual.
 
L

Logik

Active Member
#3
#3
Strange thing.
i too have accnt with the religare.........i haven't received any such thing from religare.

anyways m gonna call Indiabulls once again.....lets see what happen.

Isn't there anyone else that can help me with this matter.....??
 
alroyraj

alroyraj

Well-Known Member
#4
#4
Logik said:
Strange thing.
i too have accnt with the religare.........i haven't received any such thing from religare.

anyways m gonna call Indiabulls once again.....lets see what happen.

Isn't there anyone else that can help me with this matter.....??
Click to expand...
I opened an account with Indiabulls recently and this was enclosed in the account opening form so maybe that's it seems some are asking and the others are'nt...its necessary imaging running to the branch at the drop of a hat...not practical if its some 10-15 km away from ur residence typical in any major city....
 
A

abhishek25

New Member
#5
#5
yes as per new sebi rules brokers are not allowed to keep the funds , and each trade should be settled in 24 hrs , whatever unused amount left will be transferred to your bank account ,

to avoid this you have to give running account authorization to your broker

My indiainfoline and reliance money brokers hav asked me sign running account form

if your religare broker didnt asked u then , may be your account is new with religare and your broker already might have got signed from you
while opening account we are asked to sign at 20-30 places
 
S

seetharamank

Active Member
#6
#6
yes my RM from indiainfoline has sent me the form which worded something like we give blanket power to them regarding selling of shares at least i felt something like that &refused to sign on dotted lines some one month back i am now allowed now a margin of only what money is avilable plus holding value after haircut not 3 times or5 times exposure when i contacted the RM she couldnot explain why i should sign such a letter
 
S

Sanjay123

Member
#7
#7
The IIFL running account authorization letter asks me to :
1. Give all my shares as collatoral to them for margin funding. I do not want to margin limits.
2. Allow IIFL to keep my stocks in their DMAT rather than mine. I do not want that, and want to hold my stocks in MY DMAT.

http://www.traderji.com/brokers-trading-platforms/47451-beware-your-shares-can-stolen-too.html

The Outlook India magazine article on the above page clearly mentions the ill practices of these brokers and how they take advantage of RAA requirement imposed by SEBI, and get "other things" signed and approved by innocent, ignorant and unaware micro trader/investor at the time of getting the RAA document from the client.
 
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