sebi:Order/MR/VV/2021-22/15594
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Facts / Headnote
Violation established; penalty of INR 5,00,000 imposed under Section 15HA of the SEBI Act
Provisions invoked
- s. 15H
- s. 15I
- s. 15J
- s. 15
- s. 15F
- s. 28A
Regulations
- Reg. 3
- Reg. 4(a)
- Reg. 3(a)
Parties
- Suman Shah
Holding
The Noticee Suman Shah violated Regulations 3(a), (b), (c), (d), 4(1) and 4(2)(a) of the PFUTP Regulations by executing non-genuine reversal trades in stock options. A monetary penalty of INR 5,00,000 under Section 15HA of the SEBI Act was imposed.
Full text
Page 2 of 16 B. APPOINTMENT OF ADJUDICATING OFFICER 3. SEBI initiated adjudication proceedings and appointed the undersigned as the adjudicating officer under section 15I of the Securities and Exchange Board of India Act, 1992 (hereinafter referred to as the “SEBI Act”) read with rule 3 of the Securities and Exchange Board of India (Procedure for Holding Inquiry and Imposing Penalties) Rules, 1995 (hereinafter referred to as the “Adjudication Rules”) vide order dated September 20, 2021 to inquire into and adjudge under section 15HA of the SEBI Act, against the Noticee for the alleged violation of the aforesaid provisions of the PFUTP Regulations. The said appointment was communicated vide communiqué dated September 27, 2021.
Page 3 of 16 c) In the said contract, the trades entered by the Noticee were reversed with the same counterparty at a substantial price difference without any basis, which indicates that these trades were artificial and non-genuine in nature;
Page 4 of 16 d) That in order to be fraudulent trades, the element of ‘inducement’ must be proved and the Noticee has not induced the counterparty or the someone else and thus, the Noticee cannot be said to have committed fraud in the securities market;
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Source: SecMarx — sebi:Order/MR/VV/2021-22/15594. 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.