sebi:QJA/GR/IVD-2/ID20/31339/2024-25
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Facts / Headnote
Violations established; disgorgement of Rs. 47,22,325/- jointly and severally directed to IPEF; penalties imposed of Rs. 10,00,000/- on Rohan Banerjee and Rs. 5,00,000/- on Rahul Banerjee; assets restrained from sale except for effecting disgorgement/penalty payment.
Provisions invoked
- s. 11
- s. 11(4)
- s. 19
- s. 11(1)
- s. 12A
- s. 15H
- s. 15J
- s. 11(5)
Regulations
- Reg. 3
- Reg. 4(a)
- Reg. 2(1)(c)
- Reg. 2
- Reg. 3(a)
- Reg. 4(2)(q)
Parties
- Rohan Banerjee
- Rahul Banerjee
Holding
The Noticees, Rohan Banerjee and Rahul Banerjee, were found to have violated Section 12A(a), (b), (c) and (e) of the SEBI Act read with Regulations 3(a), 3(b), 3(c), 3(d), 4(1) and 4(2)(q) read with 2(1)(c) of the PFUTP Regulations by front running the trades of Tusk Investment Ltd. (Big Client), and were directed to disgorge Rs. 47,22,325/- jointly and severally and pay penalties of Rs. 10,00,000/- and Rs. 5,00,000/- respectively.
Full text
Order in the matter of suspected front running of the trades of Tusk Investment Ltd. by Mr. Rohan Banerjee Page 2 of 38 (Big Client) and was responsible to place orders of Tusk by calling the dealers of respective brokers of Tusk. b) During the investigation, it was observed that majority of the trades of Tusk were placed through broker, Sanctum Wealth Private Limited and Ambit Capital Private Limited by calling their respective dealers and Noticee No.1 himself made these calls. Detailed investigation revealed that Noticee No.1 had the knowledge of impending big orders of Tusk, as he was responsible to place orders for Tusk. Thus, this information was being used to front run the trades of Big Client by Noticees. c) It is observed that Noticee No.1 had 364 front running instances in equity segment against big client and the total profit earned through front running is ₹28.49 lakhs. Further, Noticee No.2 had 74 front running instances in equity segment against big client and the total profit earned through front running is ₹8.30 lakhs. Similarly, Noticee No.1 had 164 front running instances in equity derivative segment against big client and the total profit earned through front running is ₹10.42 lakhs. However, no trades were observed in F&O Segment by Noticee No.2. d) Noticee No.1, having complete information of the orders of Big client, was placing front running orders in his own as well as Noticee No.2’s account. Further, IP addresses of trades placed in the account of Noti
Order in the matter of suspected front running of the trades of Tusk Investment Ltd. by Mr. Rohan Banerjee Page 3 of 38 Act, 1992 and under Sections 11(4A) and 11B (2) for imposing penalties under SEBI Act read with Sections 15HA of SEBI Act should not be issued against them for the alleged violations mentioned above. Further, Noticees were also show caused as to why any directions for disgorgement of total wrongful gain of Rs.47,22,325/-, jointly and severally should not be issued against them.
Order in the matter of suspected front running of the trades of Tusk Investment Ltd. by Mr. Rohan Banerjee Page 4 of 38 order to trade for the Company. However, it is pertinent to note that Mr. Pranay took all the decisions. B. On perusal of the KYC documents of Tusk as received a/ w the Email dated 02.12.2024, it is submitted that it was not only me who was responsible for the
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Source: SecMarx — sebi:QJA/GR/IVD-2/ID20/31339/2024-25. 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.