Zerodha sent you this email because an alert was generated by the stock exchange system or regulator-specified internal surveillance system. As a financial intermediary, Zerodha is required by SEBI, stock exchanges and depositories to review client transactions, flag trades and seek clarification to establish the genuineness of trades.
Surveillance requirements
SEBI, stock exchanges (PDF) and depositories (PDF) require stock brokers to have effective surveillance mechanisms in place. As part of this surveillance monitoring, brokers must:
- Review client transactions
- Flag trades that trigger alerts
- Seek suitable clarification and rationale behind such trades to establish their genuineness
How alerts are generated
Stock exchanges flag certain transactions and require brokers to ask their clients for explanations. In addition to exchange-generated alerts, broker systems also generate alerts based on regulator-specified surveillance parameters. Brokers must update the stock exchange on the action taken against surveillance alerts.
What you need to do
Provide the required information by creating a ticket. When Zerodha receives your information, you will receive an acknowledgement email. If necessary, Zerodha will take appropriate action based on your response.