In a welcome move, the capital markets regulator has once again stepped into the regulatory turf of another watchdog in the interest of consumer protection. On 1 November, the Securities and Exchange Board of India (Sebi) sent a show cause notice to HSBC Bank (regulated by the Reserve Bank of India, or RBI) in the Suchitra Krishnamoorthi versus HSBC case with a hard message—answer this notice or Sebi will pass orders against the bank to disgorge the money it earned as commission from Krishnamoorthi. Sebi has also threatened to stop all mutual funds (MF) from using HSBC as a distributor and ban the bank from the securities market.
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