sebi:Order/VV/JR/2019-20/6945
Facts / Headnote
Noticee held liable for violation of PFUTP Regulations and penalty of Rs. 25,00,000 imposed under Section 15HA of SEBI Act
Provisions invoked
- s. 15
- s. 15H
- s. 15J
- s. 28A
Regulations relied on
- SEBI (PFUTP) Regulations, 2003 — 3(a)
Parties
- Umang Nemani
Holding
The Noticee Umang Nemani violated Regulations 3(a), (b), (c), (d) and 4(1), 4(2)(a) of PFUTP Regulations by executing 830 non-genuine reversal trades in 204 illiquid stock option contracts creating artificial volume of 21,85,44,000 units. A monetary penalty of Rs. 25,00,000 under Section 15HA of SEBI Act was imposed.
Full text
In the matter of dealings in Illiquid Stock Options at BSE Page 2 of 23 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 23 12:02:25 and this order was reversed at `0.05 per unit on the same day between same counter parties within 19 minutes 9 seconds.
In the matter of dealings in Illiquid Stock Options at BSE Page 4 of 23 Subsequently, copy of the SCN was affixed at the last known address of the Noticee.
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Source: SecMarx — sebi:Order/VV/JR/2019-20/6945. 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.