sebi:EAD-2/AO/13/2012
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Facts / Headnote
Violation established; penalty of Rs.2,00,000 imposed
Provisions invoked
- s. 15
- s. 15H
- s. 15J
Regulations
- Reg. 3
- Reg. 4(1)
- Reg. 15
- Reg. 4(a)
- Reg. 2
- Reg. 4(2)(a)
- Reg. 4(2)(e)
- Reg. 4(2)(g)
- Reg. 4(2)(b)
- Reg. 4(2)(n)
Holding
The Noticee, a sub-broker with ISSBL, violated Regulations 4(1), 4(2)(a), (b), (e), (g) and (n) of PFUTP Regulations and Clauses A(1), A(2), D(4) and D(5) of the Code of Conduct for Sub-Brokers, and was held liable for penalty of Rs.1,00,000 under Section 15HA and Rs.1,00,000 under Section 15HB, total Rs.2,00,000.
Full text
Page 2 of 22 trading volume in the shares of VIL and NRB during the investigation period and indulged in structured deals and reversal trades with out taken or given delivery in such a manner that led to creation of artificial volume and impacted the price of the scrip.
Page 3 of 22 violations. It was alleged in the SCN that the Noticee, a sub-broker with Intec Shares and Stock Brokers Ltd. (ISSBL) had dealt in the scrips of VIL and NRB. The Noticee traded in the scrip of VIL on 6 days for 37000 shares and accounted for 37.58% of the gross traded quantity of the market (NSE). The trading were on behalf of its clients Mr. Pankaj Gupta and M/s Classic Investments. In the scrip of NRB, the Noticee traded on 3 days for 12000 shares and accounted for 27.54%. The Noticee had dealt for its clients M/s Classis Investments. The Noticee executed structured and reversal trades in the said two scrips on behalf of the said clients with Mansukh Securities and Finance Ltd. (MSFL) Member NSE, trading in its proprietary account. No delivery was given or taken by the Noticee while trading in the said scips. Hence, alleged to have violated the abovementioned provisions of PFUTP Regulations and Brokers Regulations.
Page 4 of 22 6. The AO vide letter dated April 04 2007, granted and opportunity of personal hearing on April 20, 2007 and the Noticee appeared before the AO and made submissions. The Noticee reiterated the submissions in its reply to the SCN. The Noticee further undertaken to submit various documents in support of its contention. Following the submission of the said documents, AO granted opportunities personal hearing vide notices dated January 29, 2010, February 17, 2010 and March 05, 2010. However, the Noticee did not avail of the opportunities.
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Source: SecMarx — sebi:EAD-2/AO/13/2012. 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.