Question:
Which of the following would disqualify a person from becoming a sub-broker?
Which of the following would disqualify a person from becoming a sub-broker?
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To act as a market intermediary, a person must pass SEBI's “Fit and Proper Person” test. Any history of SEBI debarment or financial fraud fails this test.
Updated On: Jun 22, 2026
- Being over 60 years of age
- Having a college degree from another country
- Being debarred by SEBI
- Owning shares in a listed company
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Verified By Collegedunia
The Correct Option is C
Solution and Explanation
Step 1: Reviewing SEBI Intermediary Regulations:
The Securities and Exchange Board of India (SEBI) enforces strict criteria to verify that all market intermediaries are fit and proper, which helps protect investor assets and prevent market manipulation.
Step 2: Checking Disqualifying Criteria:
Let us examine the options provided:
• Age (A): There is no upper age limit of 60 years for operating as a sub-broker, provided the individual remains mentally and physically competent.
• Foreign Degree (B): A registered qualification from an accredited international university does not restrict anyone from registering, provided it meets equivalent educational benchmarks.
• Share Ownership (D): Owning equity in a listed company is a standard investment practice and does not cause a disqualification.
• SEBI Debarment (C): If an individual or corporate entity has been suspended, prohibited, or actively debarred by SEBI due to market infractions, insider trading, or fraudulent practices, they are legally disqualified from registering or acting as an intermediary.
Step 3: Conclusion:
Consequently, being debarred by SEBI (C) is an absolute, non-negotiable disqualification.
The Securities and Exchange Board of India (SEBI) enforces strict criteria to verify that all market intermediaries are fit and proper, which helps protect investor assets and prevent market manipulation.
Step 2: Checking Disqualifying Criteria:
Let us examine the options provided:
• Age (A): There is no upper age limit of 60 years for operating as a sub-broker, provided the individual remains mentally and physically competent.
• Foreign Degree (B): A registered qualification from an accredited international university does not restrict anyone from registering, provided it meets equivalent educational benchmarks.
• Share Ownership (D): Owning equity in a listed company is a standard investment practice and does not cause a disqualification.
• SEBI Debarment (C): If an individual or corporate entity has been suspended, prohibited, or actively debarred by SEBI due to market infractions, insider trading, or fraudulent practices, they are legally disqualified from registering or acting as an intermediary.
Step 3: Conclusion:
Consequently, being debarred by SEBI (C) is an absolute, non-negotiable disqualification.
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