sebi:WTM/KMA/ERO-IVD/151/10/2009
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Facts / Headnote
Enquiry proceeding in respect of dealings in Nageshwar Investment Limited during April 2005 to November 2005 disposed of with suspension of certificate of registration (INB 031152011) for six months, set off against prohibition already undergone, requiring no further penalty to be undergone.
Provisions invoked
- s. 19
Regulations
- Reg. 28(2)
- Reg. 4(2)(a)
Parties
- M/s Binoy Poddar
Holding
M/s Binoy Poddar violated Regulations 4(2)(a), 4(2)(e) and 4(2)(o) of the PFUTP Regulations and Clauses A(1) to A(4) and B(4)(a) of the Broker Code of Conduct, and its certificate of registration is suspended for six months, set off against the prohibition already undergone from November 30, 2005 to August 11, 2008 so no further penalty is to be undergone.
Full text
Page 2 of 6 CSE) not to buy, sell or deal in securities, in any manner, either directly or indirectly, till further directions. Subsequently, the said ex-parte order was confirmed by SEBI, vide order dated May 31, 2006. The investigation had identified certain stock brokers, including M/s Binoy Poddar (hereinafter referred to as the Broker) based on their pattern of trading and the volumes contributed by them in the shares of the company during the investigation period. It was further observed that most of the trades of the said stock brokers were ‘client to client’ and have been executed on a single terminal of the same stock broker and the same inter alia led to the manipulation in the shares of the company. It was inter alia alleged that the trade practices of the Broker were prima facie in contravention of the provisions of Regulation 4(2)(a), 4(2)(e) and 4(2)(o) of the PFUTP Regulations and Clauses A(1) to A(4) and Clause B(4)(a) of the Code of Conduct specified in Schedule II of the Broker Regulations.
Page 3 of 6 The Broker was also advised to inform whether it would like to avail of an opportunity of hearing. Thereafter, SEBI granted various opportunities to the Broker, vide letters dated June 23, 2009 and August 20, 2009. However, even after the receipt of the said letters, the Broker chose not to respond. Though, the Broker was specifically advised to inform in case it wished to avail a hearing, no response was received from it. In view of the deliberate attempt on the part of the Broker in not responding to the aforesaid notice/letters, I do not consider it necessary to grant another opportunity to the Broker and, proceed with the matter on the basis of the Enquiry report, the show cause notice dated March 25, 2009 (including the subsequent letters) issued to the Broker and other material available on record, in terms of the provisions of the Intermediaries Regulations.
Page 4 of 6 Cross deals Broker Name of the stock broker Qty % Broker 12,48,896 62% 4. From the extracts of the trade log received from CSE in respect of the trades of the Broker, I note that the Broker executed cross deals in the shares of the company during the price range, Rs.20.85 to Rs.55.20. Further, the Broker executed matched trades and was found to have placed both buy and sell orders of identical quantity and price in such a way that its buy orders matched with its corresponding sell orders resulting in trades. Though, the details of such trades were provided to the Broker it did not controvert the
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Source: SecMarx — sebi:WTM/KMA/ERO-IVD/151/10/2009. 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.