sebi:EAD-7/BJD/VS/2018-19/2208

SEBI · SEBI · 2018-04-03 · B J Dilip, Adjudicating Officer

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Facts / Headnote

Penalty of Rs. 5,00,000 imposed on the Noticee under Section 15HA of SEBI Act, 1992; decided ex-parte

Provisions invoked

• s. 15
• s. 19
• s. 15H
• s. 15I
• s. 15J
• s. 15I(1)

Regulations

• Reg. 3
• Reg. 4
• Reg. 2(1)(c)
• Reg. 3(a)

Parties

• Rajesh Rao

Holding

The Noticee violated Regulations 3(a), 3(b), 3(c), 3(d), 4(1) and 4(2)(a) of the SEBI (Prohibition of Fraudulent and Unfair Trade Practices) Regulations, 2003 by executing non-genuine reversal trades creating artificial volume in illiquid BSE stock options. A monetary penalty of Rs. 5,00,000 under Section 15HA of the SEBI Act, 1992 was imposed on the Noticee.

Full text

Adjudication Order in respect of Rajesh Rao Page 2 of 19 Options Segment of BSE during the investigation period. The following points narrate the dealings of the Noticee during the investigation period and the

Adjudication Order in respect of Rajesh Rao Page 3 of 19 c) The entire volume generated by the Noticee in each of the above contracts was artificial volume and further artificial volume generated by him also constituted the entire total volume from the market in said contracts.

Adjudication Order in respect of Rajesh Rao Page 4 of 19 SHOW CAUSE NOTICE, REPLY AND HEARING 9. A Show Cause Notice (hereinafter referred to as “SCN”) bearing ref. no. SEBI/HO/EAD-7/BJD/NJMR/23043/2018 dated August 16, 2018 was served upon the Noticee under Rule 4 of SEBI Adjudication Rules to show cause as to why an inquiry be not held against him in terms of Rule 4 of the Adjudication Rules and penalty be not imposed under Section 15HA of SEBI Act, 1992 for the violations alleged to have been committed by him. I note that the SCN was inter alia sent to the Noticee vide digitally signed email to the email address on record in terms of Rule 4(b) of the Adjudication Rules. From the record, I note that the said email was not bounced which constituted the valid service. However, no reply was received from the Noticee even after 5 months from the service of the Notice.

Source: SecMarx — sebi:EAD-7/BJD/VS/2018-19/2208. 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.