Sebi Fines 8 Entities Rs 40 Lakh for Non-Genuine Trades

New Delhi, Sep 30 (PTI) Sebi on Monday slapped penalties totalling Rs 40 lakh on eight entities for indulging in non-genuine trades in illiquid stock options segment on the BSE.

In eight separate orders, the regulator imposed a fine of Rs 5 lakh each on Yogesh Goyal HUF, Manju Devi Poddar, Navjeet Singh Malhotra, Narendra Kumar Maheshwari, Sandip Agarwal, CHP Finance Pvt Ltd, Vijay Agarwal, and Sunita Sethia.

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

Sebi conducted an investigation into the 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, Sebi said in the eight separate orders.

Reversal trades were not normal indicating that the trades executed by these entities were not genuine trades and being non-genuine, created an appearance of artificial trading volumes in respective contracts, the regulator said.

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

In a separate order on Monday, the markets watchdog levied a penalty of Rs 2 lakh on three individuals -- Jatin Shah, Daivik Jatin Shah, and Heli Jatin Shah -- for flouting disclosure lapses in the matter of ETT Ltd.

Pursuant to an examination conducted by the regulator, the Securities and Exchange Board of India (Sebi) had initiated adjudication proceedings against Jatin Shah, Daivik Shah, and Heli Shah for the violation of takeovers rules.

In another order, Sebi imposed a fine of Rs 2 lakh on VSE Stock Services Ltd (VSSL) for violating stock brokers norms.

The order came after a joint inspection of the VSSL, a Sebi-registered stock broker, was conducted by the regulator along with the stock exchanges for the period April 2022 to October 2023.