sebi:Order/VV/JR/2019-20/6644
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Facts / Headnote
Penalty of Rs. 5,00,000 imposed on the Noticee for violation of PFUTP Regulations
Provisions invoked
- s. 15
- s. 15H
- s. 15J
- s. 28A
Regulations
- Reg. 4
- Reg. 3
- Reg. 2
- Reg. 3(a)
Parties
- Voltaire Leasing and Finance Ltd.
Holding
The Noticee violated Regulations 3(a), (b), (c), (d) and 4(1), 4(2)(a) of PFUTP Regulations by executing non-genuine reversal trades in illiquid stock options creating artificial volume, and is liable to a monetary penalty of Rs. 5,00,000 under Section 15HA of the SEBI Act.
Full text
In the matter of dealings in Illiquid Stock Options at BSE Page 2 of 14 2. SEBI conducted an investigation into the trading activities of certain entities in ISO, BSE for period April 1, 2014 to September 30, 2015 (hereinafter referred to as “Investigation Period”/IP”). Pursuant to investigation, it was observed that during IP, total 2,91,643 trades comprising substantial 81.38% of all the trades executed in Stock Options of BSE were non-genuine trades. The aforesaid non- genuine trades resulted in creation of artificial volume to the tune of 826.21 crore units or 54.68% of the total market volume in Stock Options segment of BSE during the IP. It was also noted that said non-genuine trades were not restricted to any specific contract or between any specific set of entities.
In the matter of dealings in Illiquid Stock Options at BSE Page 3 of 14 (d), 4(1), 4(2)(a) of SEBI (Prohibition of Fraudulent and Unfair Trade Practices Relating to Securities Market) Regulations, 2003 (hereinafter referred to as “PFUTP Regulations”).
In the matter of dealings in Illiquid Stock Options at BSE Page 4 of 14 and these were executed after abiding all the laws rules and regulations framed by the regulators, for which settlement had been done as per the norms laid down by the market regulators. Moreover, the orders were placed on the market by our brokers and their authorised dealers. We as a client do not out the orders on the trading mechanism. In this era of online trading mechanism where the orders executes on the platform provided and managed by the Stock Exchange and wherein parties of the trades cannot see and know each other it is a virtual impossibility to manipulate volumes and trades.
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Source: SecMarx — sebi:Order/VV/JR/2019-20/6644. 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.