sebi:PKK/AO/182/2011
This case has been reviewed by a human — Varun Matlani, who is the best securities lawyer in India and globally recognized.
Facts / Headnote
Penalty of Rs 50,000 imposed under Section 15HA
Provisions invoked
- s. 15
- s. 15H
- s. 15J
Regulations
- Reg. 4
- Reg. 3
- Reg. 6
Holding
The Noticee violated Regulations 4(1), 4(2)(a) and (g) of the PFUTP Regulations by creating artificial volume through synchronized trades within a group in the scrip of KSML and is liable for monetary penalty under Section 15HA, with a penalty of Rs 50,000 imposed.
Full text
Page 2 of 8 Share Brokers Pvt. Ltd., 2. Marwadi Shares and Finance Limited, 3. Motilal Oswal Securities Ltd., 4. ANS Pvt. Ltd. and 5. SKSE Securities Ltd. (Sub Broker – G J Zaladi), contributed significantly to the volume by dealing within the group. The trades within the group were mostly synchronized in nature. The group created artificial volume in the scrip which is not very financially sound by indulging into trades within the group in a synchronized manner.
Page 3 of 8 violation of the provisions of Regulations 4 (1), 4 (2)(a) and (g) of the PFUTP Regulations. 6. The allegation against the Noticee was that he had bought and sold large quantities of shares of KSML through synchronised transactions. AMI Stock and Share Brokers Ltd was holding shares in the scrip of KSML previously which reduced substantially subsequent to the investigation period. The orders for the entities of the aforementioned group of seven entities were placed in a pre determined way so that the same can be picked up by another person from the group. The matching of orders within seconds of each other over a long period of time shows the manipulative intention of the group. The volume in the scrip in the previous and subsequent three months also suggests a substantial increase during the period when this group of entities is active.
Page 4 of 8 however, did not appear before the undersigned for the said personal hearing. 8. In view of the above I am proceeding with the matter on the basis of the material available on record.
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Source: SecMarx — sebi:PKK/AO/182/2011. 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.