Sebi levies Rs 55 lakh fine on 11 entities for non-genuine trades

The orders came after the regulator observed large-scale reversal trades in the illiquid stock options segment on the BSE, leading to artificial volumes on the exchange.
Image used for representational purpose only. (File Photo)
Image used for representational purpose only. (File Photo)

NEW DELHI: Sebi has levied penalties totalling Rs 55 lakh on 11 entities for indulging in non-genuine trades in the illiquid stock options segment on the BSE.

In 11 separate orders, the regulator slapped a fine of Rs 5 lakh each on Kamala Agarwal, Kamla Devi Bajoria, Kamla Jain, Kamaljeet Kaur, Kamal Ramprasad Gupta, Kamal Kumar, Kamlesh Ahuja, Kailash Narottamdas Anam, Sanjay Kumar Daga HUF Pragma Suppliers Pvt Ltd and Aromatic Tie Up Pvt Ltd.

The orders came after the regulator observed large-scale reversal trades in the illiquid stock options segment on the BSE, leading to artificial volumes on the exchange.

Sebi conducted an investigation into the trading activities of certain entities engaged in the segment from April 2014 to September 2015.

The entities to be fined were among those who indulged in reversal trades, Sebi said in the 11 separate orders on Thursday.

Reversal trades are non-genuine as they are executed in the normal course of trading, leading to a false or misleading appearance in terms of generating artificial volumes, the regulator said.

By indulging in such trades, the entities violated the PFUTP (Prohibition of Fraudulent and Unfair Trade Practices) norms, it said.

In a separate order on Wednesday, Sebi imposed fines totalling Rs 20 lakh on two entities for flouting disclosure rules in the matter of IFL Promoters Ltd.

In another order, the regulator suspended the registration of 3M Team Research Pvt Ltd for a period of one year for violating the regulatory norms.

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