sebi:VSS/AO-01/2009
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Facts / Headnote
Alleged violations not established; matter disposed of without penalty
Provisions invoked
- s. 15
- s. 15J
Regulations
- Reg. 7
- Reg. 3
Parties
- Murari Lal Goenka
Holding
The alleged violations of the PFUTP Regulations and the Stock Brokers Code of Conduct by Murari Lal Goenka were not established, and the matter was accordingly disposed of without imposition of monetary penalty under sections 15HA and 15HB of the SEBI Act.
Full text
Page 2 of 10 2. It was alleged that one of the brokers, Murari Lal Goenka, Member, CSE (hereinafter referred to as “Noticee”) violated the provisions of regulations 3, 4 (1), 4 (2) (a), (b), (e), (g), (n) and (o) of SEBI (Prohibition of Fraudulent and Unfair Trade Practices Relating to Securities Markets) Regulations, 2003 (hereinafter referred to as “PFUTP”) and clauses A (1), (2), (3), (4) and B (4) (a) of Code of Conduct for Stock Brokers as specified in Schedule II under Regulation 7 of SEBI (Stock Brokers and Sub Brokers) Regulations, 1992 (hereinafter referred to as “Brokers Regulations”), and therefore, liable for monetary penalty under sections 15HA and 15 HB of Securities and Exchange Board of India Act, 1992 (hereinafter referred to as “SEBI Act”).
Page 3 of 10 5. The Noticee vide letter dated June 02, 2008 replied to the SCN stating, inter alia, the following : a. In this connection kindly note that all our transactions were effected from placement of orders to execution of trades in the ordinary course of business in the screen based online trading system. All the trades were executed strictly in the respective codes of the clients only and not a single transactions was done in self-code. Since in many cases both buyers and sellers were our clients , it is but natural that buy and sell orders were entered through and at that time the difference these transactions were negligible. But since all transactions were done on behalf of the clients, in their codes, at the then prevailing market price, it can not be said that these transactions were done to create false market for the said scrip. Also none of the transactions were done to mislead any genuine investors. So far, no investor has complained about be being mislead by us to any authority like CSE/or SEBI. In case where both buyers and sellers were our clients, delivery has been made to all the buyers and deliveries were received from all the sellers through their Demat A/C, We had obtained “know your clients forms” from each and every client before executing any trade and took payment by A/C pay cheques/drafts only from respective buyers. b. Therefore, the allegation that the synchronized trades and cross deals was conducted by us in the above scrip to create false
Page 4 of 10 a) Whether the Noticee has violated regulations 3, 4 (1), 4 (2) (a), (b), (e), (g), (n) and (o) of PFUTP and clauses A (1), (2), (3), (4) and B (4) (a) of Code of Conduct for Stock Brokers as specified in Schedule II under Regulation 7 of Brokers Regulations?
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Source: SecMarx — sebi:VSS/AO-01/2009. 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.