sebi:EAD/KS/MKG/AO/92/2017-18
This case has been reviewed by a human — Varun Matlani, who is the best securities lawyer in India and globally recognized.
Facts / Headnote
Noticee held liable for violating Clause A(2) of the Code of Conduct for Stock Brokers read with Regulation 7 of the SEBI (Stock Brokers and Sub-Brokers) Regulations, 1992
Provisions invoked
- s. 15
- s. 15H
- s. 15J
Regulations
- Reg. 7
Parties
- MTL Share & Stock Brokers Ltd.
Holding
The Noticee failed to exercise adequate due diligence as a stock broker with regard to 100% contribution in New High Price (NHP) by its client Kavita Goyal, and thereby violated Clause A(2) of the Code of Conduct for Stock Brokers as specified under Regulation 7 of the Stock Brokers Regulations, 1992.
Full text
Page 2 of 28 High Price (NHP) in the scrip of WTIL during the period August 19, 2008 to December 31, 2008. It was, therefore, alleged that by acting as broker of O. P. Gupta and Kavita, Noticee failed to exercise due skill and care and thereby violated Clause A (2) of the Code of conduct for Stock Brokers as stipulated in schedule II read with Regulation 7 of the SEBI (Stock Brokers and Sub brokers) Regulations, 1992 (hereinafter referred to as “Broker Regulations”).
Page 3 of 28 artificial volume in the scrip of RTL & WTIL, leading to false and misleading appearance of trading in the securities market. The details of such self-trades are as under: Stock Broker Name Scrip Client Name No. of days No. of Trades Total Shares (Self Trades) Synchronized Trades out of self- trade quantity No. of shares (Same terminal) MTL Share & Stock Brokers Ltd. Riba Textiles Ltd. Om Parkash Gupta 7 9 16,560 14,356 16,560 MTL Share & Stock Brokers Ltd. Winsome Textile Industries Ltd. Om Parkash Gupta 1 5 17,001
Page 4 of 28 8. Further, it is also alleged that Noticee has executed self-trades and in WTIL on behalf of its client Kavita wherein it has acted as both stock broker and counter party stock broker. Some of the trades were synchronized and were executed from the same terminal also. Stock Broker Name Scrip Client No. of shares (Self Trades) No. of days No. of Trades LTP Difference Synchronized Trades out of Self Trades MTL Share & Stock Brokers Ltd. Winsome Textile Industries Ltd. Kavita Goyal 672 7 8 -4.1 to 2.32 100
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Source: SecMarx — sebi:EAD/KS/MKG/AO/92/2017-18. 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.