NEW DELHI: Regulator SEBI has barred Voltaire Leasing and Finance Ltd and 22 other entities, including former directors, from capital markets for up to two years for indulging in fraudulent trade.
The company, its ex-chairman and managing directors -- Amlesh Sadhu and Dilip Patodia, and former executive director Harivallabh Mundra have been prohibited for two years, while the remaining 19 entities have been restrained for a period ranging from six months to one year, SEBI said in an order.
The regulator conducted an investigation into trading and dealings in the scrip of Voltaire Leasing & Finance Limited (VLFL) after receiving a reference from Department of Income Tax, Chandigarh, for possible violation of provisions of SEBI norms.
The SEBI probe, which was conducted in the scrip of VLFL for August 2014 to July 2015 period, found that three entities (off-market transferors) transferred shares of the company through off-market transfers to 16 connected entities.
Further, these 16 entities contributed to an increase in the net and positive last trading price of the company's shares.
Besides, the company and its three former directors were part of this scheme by virtue of a connection between the firm and one of the off-market transferors. "All the noticees i.e. the group of off-market transferors, the group of sellers and the company and its directors in charge of its affairs at the time of the violations, have manipulated the price of the scrip of VLFL during the period August 12, 2014 to July 31, 2015," SEBI said in its order on Monday.
By indulging in such trades, they violated the provision of PFUTP (Prohibition of Fraudulent and Unfair Trading Practices), it added.
In case these entities have any open positions in any exchange traded derivative contracts, they can close out or square off such open positions within 3 months from the date of order or at the expiry of such contracts, whichever is earlier, the regulator noted.
It added that it has been clarified that these entities can settle the pay-in and pay-out obligations in respect of transactions, if any, which have taken place before the close of April 13, this year.