Sebi slaps Rs 55 lakh penalty on 11 entities for non-genuine trades

New Delhi: Capital markets regulator Sebi on Thursday slapped penalties totalling Rs 55 lakh on 11 entities for indulging in non-genuine trades in illiquid stock options segment on the BSE. In 11 separate orders, the regulator slapped a fine of Rs 5 lakh each on Sanjay Kumar Agarwal HUF, Manoj Agrawal, Kanta Didwania, Harish Chandra Baldewa, Daksha Kirit Patel, Bestway Dealcom, Ziya Merchandise, S K Agarwal, and Sons HUF, Sumit Agarwal, Spectrum Technoprojects Pvt Ltd, and Sanjeev Mittal HUF.

The orders came after the regulator observed large-scale reversal trades in the illiquid stock options segment on the BSE, leading to artificial volumes on the exchange.

The Securities and Exchange Board of India (Sebi) conducted an investigation into trading activities of certain entities engaged in the segment from April 2014 to September 2015.

The entities to be fined were among those who indulged in reversal trades.

Reversal trades are non-genuine as they are executed in the normal course of trading, leading to a false or misleading appearance in terms of generating artificial volumes, Sebi said.

By indulging in such trades, the entities violated the Prohibition of Fraudulent and Unfair Trade Practices (PFUTP) norms, it said.

In a separate order on Wednesday, Sebi imposed a fine of Rs 5 lakh each on Manoj Jain HUF and Vimal Kumar Saini for indulging in non-genuine trades in illiquid stock options segment on the BSE.

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