NSE uncovers broker breaches in margin trading, fund handling and cyber security

The National Stock Exchange has identified compliance breaches by several stock brokers. Inspections carried out from October 2025 through March 2026 revealed brokers were offering margin trading on securities that do not meet eligibility criteria. The review also found that some firms mishandled client funds, failing to keep them segregated as required. Brokers did not adhere to the exchange’s cybersecurity standards, exposing systems to potential attacks. Surveillance mechanisms were found lacking, limiting the ability to detect market abuse. Margin trading lets investors borrow money to buy shares, but the exchange permits it only on approved securities. Proper handling of client money is mandated to keep it separate from a broker’s own assets. ## Context The NSE sets rules for trading and monitors participants to protect investors and maintain market integrity. Compliance checks like these are part of its routine oversight to ensure fair and secure market operations.