SEBI Imposes Rs 62 Lakh Fine On Six Entities For Fraudulent Trading

It was alleged that Utkarsh, Vanya, Realstep, Fanaswala, Darji and Charamsukh IT Marketing had violated the provisions of PFUTP (Prohibition Of Fraudulent And Unfair Trade Practices) norms

PTI

Updated on: 21 February 2023 8:37 pm

SEBI (Securities and Exchange Board of India)

Capital market regulator SEBI on Tuesday imposed fines totalling Rs 62 lakh on six entities for indulging in fraudulent trade practices in the shares of North Eastern Carrying Corporation Ltd (NECC).

The regulator slapped a fine of Rs 15 lakh on Realstep Agencies, Rs 10 lakh each on Utkarsh Jain, Vanya Jain (promoters of NECC), Sairabanu Mohd Rafiq Fanaswala and Malatiben Ashokbhai Darji and Rs 7 lakh on Charamsukh IT Marketing.

The order came after SEBI carried out an investigation in the scrip of NECC for the period from December 2016 to April 2017.

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It was alleged that Utkarsh, Vanya, Realstep, Fanaswala, Darji and Charamsukh IT Marketing had violated the provisions of PFUTP (Prohibition Of Fraudulent And Unfair Trade Practices) norms.

The regulator found in its investigation that Utkarsh and Vanya sold shares and created misleading appearance of trading in the market for the days on which such trading took place.

The trades bypassed the normal market mechanism, affecting interests of genuine investors who traded in the scrip of NECC.

According to SEBI, Charamsukh IT Marketing and Realstep were the connected entities of Utkarsh and Vanya Jain, helped them to offload their shares and exit the scrip of NECC by placing buy orders in sufficient quantities and matching their buy order rates.

The regulator also found Realstep, Fanaswala and Darji have created artificial volume in the shares of NECC through execution of circular trades by contributing 14.06 per cent of the market volume in the scrip.

Through such acts, the entities have violated the provisions of PFUTP norms.

In a separate order, the regulator prohibited RB Traders and its proprietor Raj Bhadur Bhdoriya from the securities markets for a period of six months for indulging in unauthorised investment advisory services and also imposed a penalty of Rs 8 lakh on them.

Also, they have been asked to refund the money collected from investors in respect of such services.

As per the regulator, they were involved in the activities of investment advisers without obtaining registration from SEBI, which is in violation of IA rules.