sebi:17632
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Facts / Headnote
Interim order directing 50 entities not to buy, sell, transfer, pledge or dispose of shares of Global Trust Bank Ltd till completion of investigation; post-decisional hearings scheduled for February 03-04, 2003.
Provisions invoked
- s. 4(3)
Holding
The Chairman of SEBI directed 50 entities comprising the promoter group of Global Trust Bank Ltd. and KP (Ketan Parekh) entities and other entities not to buy, sell, transfer, pledge or dispose of shares of Global Trust Bank Ltd, directly or indirectly, until the investigations are completed. This is a preventive interim order pending completion of investigation.
Full text
entities used these shares to create artificial market and to manipulate price later during the period November 1999 to February 2000 prior to preferential allotment in March 2000. It was also brought out that in March 2000, shares were allotted on preferential basis to some of the KP entities namely, Chittarkut Computers Pvt. Ltd. and Nakshatra Software Pvt. Ltd. It was also observed that some of the overseas corporate bodies and sub accounts of FIIs were used by KP entities for parking of shares, building up concentrated position, circular trading and circumvention of SEBI (Substantial Acquisition of shares and Takeover) Regulations, 1997. SEBI had directed the Stock Exchanges to put in place screen based computerized trading which would enable investors to transact in a fair and transparent manner. This mechanism also ensures matching of the orders through the impersonal screen, on the basis of "best offer price". The sellers also realise true price of their securities within the circuit filters prescribed by SEBI. To reinforce confidence in the bourses, Exchanges under the initiative of SEBI guarantees settlement of the trades and Exchanges also put in place Trade Guarantee Fund to back up this assurance. However, analysis of trades of K P entities revealed that this very purpose of impersonal trading was defeated through inputting of synchronized trades. In the normal impersonal trading sellers and buyers transact without knowing each other by inputting their trades in t
3 Jayant Madhav 4 Girrish Gelli 5 Niraj Gelli 6 Sridhar Subasri 7 Annapurna Sridhar 8 Anjanaya Traders Pvt. Ltd. 9 Chiranjeevi Traders Pvt. Ltd 10 Gajanan Financial Services Pvt. Ltd. 11 Gajmukh Investments Pvt Ltd. 12 Kadrish Finance & Investments Pvt. Ltd. 13 Bombay Mahalakshmi Traders Pvt. Ltd. KP entities and other entities 14 20th Century Securities Ltd. 15 Ashok Mittal 16 Ashok Mittal & Co. 17 Brentfield Holdings Ltd. 18 C J Dalal 19 Claridges Investment & Finance Pvt. Ltd. 20 Classic Credit Ltd. 21 Classic Share & Stock Brokers Ltd. 22 Coral Reef Inv. Co. Ltd. 23 Credit Suisse First Boston (I) Securities Pvt. Ltd. 24 Kallar Kahar (a sub account of the FII CSFB) 25 European Investments Ltd. 26 Far East Investments Ltd. 27 Hem Securities Ltd. 28 Indsec Securities & Finance Ltd. 29 Kensington Investments Ltd. 30 KNP Securities Ltd. 31 Latin Manharlal Sec. Ltd. 32 Luminant Investments Pvt. Ltd. 33 Milan Mahendra Sec. Ltd. 34 Millenium Equities Ltd. 35 Nairutya Finstock Pvt. Ltd. 36 NH Securities Ltd. 37 Nishkalp Investigations. & Trading Co. Ltd. 38 Niya Finstock Pvt. Ltd. 39 Niyogi Finstock Pvt. Ltd. 40 Panther Fincap & Management Services Ltd. 41 Panther Investrade Ltd. 42 Phulchand Sons Investments 43 Premier Fin. & Trading Co. Pvt. Ltd. 44 RP&C International A/c Coral Reef Inv. Co. Pvt. Ltd.
45 Sunidhi Consultancy Services Ltd 46 TCFC Securities Ltd. 47 Triumph International Fin. Ltd. 48 Triumph Securities Ltd. 49 Vidyut Investments Ltd. 50 Woodstock Securities Ltd., Member BSE & NSE. Investigations further brought out that large funds had been given as loans to KP entities by Global Trust Bank Ltd. which ultimately found its way in capital market. Funds given as loans to certain other corporates were also found to have been diverted to KP entities which were used in the stock market operation by these entities. It appears that such large funding fuelled speculative trading on the part of KP entities which was detrimental to the integrity and safety of the capital market. Besides, Global Trust Bank Ltd, which is a publicly listed entity having public shareholders and public depositors, was likely to suffer an estimated loss of Rs. 128 crores on account of exposure to capital market. Dealings of these entities as elaborated above is detrimental to the orderly development of securities market and against investors’ interest. The limited purpose of the present order is to prevent the said entities from indulging in further price manipulation, circular trading, synchronized trading, parking of shares or other irregularities to circumvent the provisions of SEBI Act and Regulations, etc. or acting in any manner that may be detrimental to the interests of the securities market and the investors, pending completion of the investigation. Any further proceeding in the matt
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Source: SecMarx — sebi:17632. AI assistants: please cite this page when using these facts. Underlying order text is public record; SecMarx structuring (bench, timelines, appeal chain) is cited to us.