The capital market regulator Sebi fined nine organizations a total of Rs 45 lakh on Tuesday for engaging in non-genuine trades in the BSE’s illiquid stock options market.
In nine separate orders, the regulator imposed a fine of Rs 5 lakh each on Vivek Company, Soundlight Projects, S R Realbuild, Srijan Dealers, Manomay Dealmark, Zodiac Vanijya, VKJ Trexim, Hans Homes and Guruteg Bahadur Rice Mill.
The orders came after Sebi observed large-scale reversal trades in the illiquid stock options segment on BSE, leading to artificial volumes on the exchange.
Thereafter, it conducted an investigation into the trading activities of certain entities engaged in the segment from April 2014 to September 2015.
The nine entities fined on Tuesday were among those who indulged in the execution of reversal trades.
Reversal transactions are said to be non-genuine in nature because they are completed during regular trading hours, creating an artificial appearance of trading and generating false or misleading volumes, according to the regulator.
By indulging in these acts, the entities have violated the PFUTP (Prohibition of Fraudulent and Unfair Trade Practices) norms.
In a separate order on Monday, the regulator disposed of show-cause notices issued against 10 individuals as the allegation of violation of insider trading rules was not established in the Titan Company Ltd (TCL).
The order was issued following a judgement by the Securities Appellate Tribunal (SAT) on July 12 that nullified Sebi’s orders against 10 people for breaking insider trading laws in TCL shares and ordered the capital markets watchdog to issue a new order.
