sebi:WTM/GA/100/ISD/11/06
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Facts / Headnote
Minor penalty of suspension of certificate of registration for a period of fifteen days, effective on expiry of 21 days from date of order
Provisions invoked
- s. 12
Regulations
- Reg. 7
- Reg. 13(4)
- Reg. 5(1)
- Reg. 13(2)
- Reg. 200
- Reg. 4(b)
- Reg. 199
Parties
- M/s Hexagon Capital Markets Ltd.
Holding
M/s Hexagon Capital Markets Ltd. violated SEBI Circular dated April 11, 1997 and Clause A(2) of the Code of Conduct read with Regulation 7 of the Broker Regulations, and its certificate of registration is suspended for fifteen days.
Full text
1.1 M/s Hexagon Capital Markets Ltd. (hereinafter referred to as the Broker) is a member of the Bangalore Stock Exchange Ltd. (hereinafter referred to as BgSE) and is registered with the Securities and Exchange Board of India (hereinafter referred to as SEBI) as a stock broker under section 12 of Securities and Exchange Board of India Act, 1992 (hereinafter referred to as the said Act) with registration number INB081008934. 1.2 The shares of Home Trade Ltd. (hereinafter referred to as HTL) was listed at Pune Stock Exchange Ltd. (hereinafter referred to as PSE) on November 15, 1999 at Rs 250/- and at BgSE on November 16, 1999 at Rs.275/-. There was a very sharp rise in the price of the shares of HTL both at PSE and BgSE. The price of the share of HTL reached Rs.315/ -within two weeks of its listing, i.e. by December 06,
Practices Relating to Securities Markets) Regulations, 1995 ( hereinafter referred to as FUTP Regulations) and SEBI (Stock Brokers and Sub-Brokers) Regulations, 1992 (hereinafter referred to as the Broker Regulations). It was noticed that the Broker along with other members of BgSE had contributed more than 98% of the volumes in the shares of HTL and it was alleged that the Broker had resorted to circular trading in the shares of HTL with the other members of BgSE. 1.5 The transaction details of the Broker in the shares of HTL on behalf of his sole client, Smt. Pukhraj Devi Sanhceti are mentioned below: Period Gross Purchase (shares) % to the total buy volume at BgSE Gross Sales (shares) % to the total sell volume at BgSE April 01, 2001 to December
2.2 A show cause notice was also issued to the Broker and the alleged violations leveled against the Broker are the following: “1. The broker traded for the client without any introduction. The details of the introducer including the address in the client introduction form is not filled which is in violation of SEBI Circular No. SMD/POLICY/CIRCULAR/5-97 dated 11.04.1997.
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Source: SecMarx — sebi:WTM/GA/100/ISD/11/06. 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.