Securities and Exchange Board of India (SEBI) imposed a penalty of Rs 7 lakh on Reliance Strategic Investments Limited for Nifty futures & options trade manipulation on Friday. It is a subsidiary of Reliance Industries Limited (RIL).
Economic Times reported that the case under SEBI’s scanner pertained to transactions in long-dated Nifty 50 options between July 31 and August 10, 2017 of Reliance Strategic Investments and Morgan Stanley (France) SA. Following the investigation, the markets regulator has found entities guilty of trading Nifty options at a price arrived at through mutual agreement which was significantly away from the fair market value.
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SEBI has asked the RIL arm to submit the fine within 45 days of receiving the order.
Earlier this year, Morgan Stanley (France) SA had settled the case with SEBI after payment of Rs 25.35 lakh. The markets regulator had issued a show cause notice in December 2021, following which the company had filed a settlement application in February last year. SEBI’s High Powered Advisory Committee (HPAC) recommended the settlement amount and asked for the recovery from officer in default to protect investors. In its confirmation of the settlement, the firm had assured that it will submit necessary compliance documents related to recovery from officer in default.
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The move to settle the case was completed under settlement regulations of the markets regulator. They allow parties to settle a case without accepting or denying guilt. SEBI has alleged both entities of violating provisions of Prohibition of Fraudulent and Unfair Trade Practices regulations.
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