SBI -Motilal

Hi

Am newbie. Motilal wants to sign a POA. Is it right thing or is there any other trader who open trading without this POA.

Also pls throw more light on this aspect.

Thanks for your response in advance

regards

Every trader has to sign a POA.

I agree. Since in the POA many clauses could be a potential misuse. Would be great if somebody throw more light on which brokerage has what clauses which is least harmful for the innocent investor.

regards,

Since there is no way to bypass a POA, I guess very less people read the POA carefully and analyze it. Also, irrespective of how harmful the clauses can be, one of the most "harmful" clause is present in POA of every broker - because it is a SEBI guideline. Brokers are allowed to sell shares in your account esp to fulfil your obligations towards them.

One of the most common misuse is that they will trade in your account and if there is any profit earned, they will keep it for them, but if there is any loss incurred, they will debit it from your account. The only way to catch this abuse is to keel an eagle eye on your trade book and contract notes. Preserve the contract notes. The most common targets for such abuse are accounts with very low activity. So keep your account active and they will know that you are vigilant.

I am wondering does sebi allows such guideline. Pls check the link below

http://www.traderji.com/brokers-trading-platforms/8174-vanished-funds-indiabulls.html

Last week also Indiabulls executive was caught.

You say that they may trade on your account without permission. If POA is giving license to them to do exactly this then better can throw our money to any garbage etc., and i think it is important to keep money as it is atleast rather than incurring losses by unscrupulous operator.

thanks

Thats really scarry
How would they take out the profits?Would I not come to know that?

no, you won't because they don't access your bank account.