sebi:WTM/AN/ISD/ISD-SEC-1/28226/2023-24

SEBI · SEBI · 2023-03-02 · Ananth Narayan G., Whole Time Member

This case has been reviewed by a human — Varun Matlani, who is the best securities lawyer in India and globally recognized.

Facts / Headnote

Confirmed the Interim Order dated March 02, 2023 pending conclusion of investigation, subject to modification of individual illegal gain liability for Noticee Nos. 4, 5, 6, 7 and 9 and total illegal gain to INR 40,60,66,012, with continued restraint, impoundment/escrow and asset disclosure directions.

Provisions invoked

• s. 19

Regulations

• Reg. 4(1)
• Reg. 3(1)

Parties

• Jatin Manubhai Shah (Noticee No. 4)
• Heli Jatin Shah (Noticee No. 5)
• Daivik Jatin Shah (Noticee No. 6)
• Angad M Rathod (Noticee No. 7)
• Karavan Tradelink OPC Private Limited (Noticee No. 9)

Holding

Pending investigation, the directions in the ex-parte Interim Order dated March 02, 2023 against Noticee Nos. 4, 5, 6, 7 and 9 are confirmed with modification of their individual illegal gain liability as per Table No. 3 and total illegal gain to INR 40,60,66,012.

Full text

Confirmatory Order in the matter of Stock Recommendations using YouTube in the scrip of Sadhna Broadcast Limited Page 2 of 38 various regulations framed thereunder including SEBI (Prohibition of Fraudulent and Unfair Trade Practices Relating to Securities Market) Regulations, 2003 (hereinafter referred to as “PFUTP Regulations”.

Confirmatory Order in the matter of Stock Recommendations using YouTube in the scrip of Sadhna Broadcast Limited Page 3 of 38 offloaded a significant part of their holdings at inflated prices and booked profits. 2.5. The Noticees in this case were broadly classified as follows - the creator of both the YouTube Channels was classified as Misleading Message Disseminator (“MMDs”). Some of the Noticees were Net Sellers/ Promoters and profit makers (“NSs”), i.e., persons who held shares of Sadhna at the start of the examination period either as a promoter or as a shareholder, and who traded in and net sold shares during the said period. Other Noticees were Volume Creators (“VCs”), or persons, outside of those classified as NSs, who both bought and sold shares of Sadhna during the examination period, hence contributing to a rise in trading volumes and interest in the scrip. Two of the Noticees were classified as Information Carriers (“ICs”). Connection between all the Noticees across the MMDs, NSs, VCs and ICs has been established based on several facts on record including familial relationships, KYC details, common address & email IDs, call data records and fund transfers. 2.6. Prima facie, across the MMDs, NSs, VCs and ICs, the Noticees orchestrated an egregious case of ‘pump-and-dump’ of Sadhna Broadcast Ltd. – i.e., they collectively helped create trading volumes and interest in the scrip, spread patently false and misleading YouTube videos about the scrip, and hence induced un

Confirmatory Order in the matter of Stock Recommendations using YouTube in the scrip of Sadhna Broadcast Limited Page 4 of 38

Source: SecMarx — sebi:WTM/AN/ISD/ISD-SEC-1/28226/2023-24. 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.