Sebi Slaps ₹35 Lakh Penalties On 7 Entities For Non-genuine Trades

Capital market regulator Sebi has slapped penalties totalling Rs 35 lakh on seven entities for indulging in non-genuine trades in the illiquid stock options segment on BSE.

In seven separate orders on Thursday, the regulator imposed a fine of Rs 5 lakh each on Dilip Kumar Kedia-HUF, Appu Marketing and Manufacturing (now known as Ejecta Marketing Ltd), Meena Agarwal, City Gold Media Ltd, Competent Finlease, Sanjiv Kumar Agarwal and Shah Dhaval Surendrabhai-HUF.

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

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

The seven entities that have been fined on Thursday were among those who indulged in the execution of reversal trades.

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

By indulging in these acts, the entities have violated the PFUTP (Prohibition of Fraudulent and Unfair Trade Practices) norms.

Meanwhile, in a separate order on Friday, the capital markets watchdog imposed a penalty of Rs 20 lakh on five entities for indulging in manipulation of the share prices of AKG Exim Ltd.

The entities are Satsai Finlease, Anm Fincap, Savita Holdings, Raj Kumar Bansal and Ishu Sharma and the fine is to be paid by them jointly and severally.