sebi:IVD/WOL/AO/DRK/ASG/EAD3-45/2009
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Facts / Headnote
Penalty imposed on the noticee for violations of PFUTP Regulations
Provisions invoked
- s. 15
- s. 15H
- s. 15J
Regulations
- Reg. 3
- Reg. 4(1)
- Reg. 31
Parties
- Genus Commu-Trade Ltd.
Holding
The Adjudicating Officer held that Genus Commu-Trade Ltd. violated Regulations 3 and 4(a) of the PFUTP Regulations, 1995 read with Regulations 4(1), 4(2)(a) and (e) of the PFUTP Regulations, 2003 by executing synchronized/structured trades and engaging in price manipulation of the scrip of WOL, and imposed a penalty of Rs. 5,00,000 under Section 15HA of the SEBI Act.
Full text
Page 2 of 15 alert. The period of investigation by BSE was January 01, 2003 to October 30, 2003. The major Observations of BSE were that the major buying and selling clients in the scrip were connected /related with each other, with WOL and a certain group of entities called the Parklight Group. WOL appears to a Parklight group company. The volumes in the scrip were created artificially amongst these entities and they contributed to almost 80 per cent of the total market volumes during the entire period of investigation. Self trades, circular trading, synchronized/ structured trades and reversal of trades amongst various other members were also observed with almost negligible deliverable position thus contributing to the volumes in the scrip. Based on the above facts, SEBI conducted an investigation relating to buying, selling or dealing in the shares of WOL for the period from January 01, 2003 to October 23, 2003 (hereinafter referred to as the ‘Investigation Period’).
Page 3 of 15 3.15 on October 10, 2003 and then came down to Rs 1.89 on October 30, 2003. 6. The IR observed that in the pre Stock Split Period, between January 01, 2003 and March 12, 2003 the scrip was traded on only two days i.e. February 25 and 26, 2003 for 14,80,000 shares and 80,000 shares respectively at Re 0.15. All these shares were purchased by 4 members of the Wadhwa family. The sellers were Alpha Fincaps Ltd. (2,80,000 shares), Galaxy Infosoft Ltd. (4,00,000 shares), Genus Commutrade Ltd. (4,00,000 shares) (hereinafter referred to as ‘the noticee’) and Hema Paresh Patel (4,80,000 shares) all trading through the stock broker Parklight Investments Pvt. Ltd. Parklight Securities Ltd., a Parklight group company and WOL had a common major shareholder Kirti R Patel. The IR noted that these trades were carried out solely for the purpose of creating artificial volume.
Page 4 of 15 Practices relating to Securities Market) Regulations, 2003 (hereinafter referred to as ‘PFUTP Regulations’) alleged to have been committed by the noticee.
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Source: SecMarx — sebi:IVD/WOL/AO/DRK/ASG/EAD3-45/2009. 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.