SEBI IMPOSED FINE FOR
DEALING IN ILLIQUID STOCK OPTIONS
Markets regulator Sebi
has imposed a total penalty of over Rs 20 lakh on four firms for indulging in
fraudulent trades, which created artificial volume in the illiquid stock
options segment on the BSE.
The regulator has levied
a fine of Rs 5 lakh each on Avinash Infra Projects, Bina Udyog, Balajee
Structurals and Rs 5.5 lakh on Blackcherry Commosale.
|
Avinash
Infra Projects
|
Rs
5 Lacs
|
|
Bina
Udyog,
|
Rs
5 Lacs
|
|
Balajee
Structurals
|
Rs
5 Lacs
|
|
Blackcherry Commosale
|
Rs
5.5 Lacs
|
LARGE-SCALE REVERSAL OF TRADES
The Securities and
Exchange Board of India (Sebi) conducted an investigation into the trading
activities of certain entities in illiquid stock options at the BSE between
April 2014 to September 2015, after observing large-scale reversal of trades in
the bourse's stock options segment.
PFUTP (PROHIBITION OF FRAUDULENT AND UNFAIR TRADE
PRACTICES)
The probe found that these firms reversed their buy or sell
positions with the same counter party during the same day and thus defied the
criteria to be called as normal trading practice, the regulator noted in
similarly worded separate orders.
By indulging in such trades, these entities violated provisions of the PFUTP (Prohibition of Fraudulent and Unfair Trade Practices) regulations, it added.
By indulging in such trades, these entities violated provisions of the PFUTP (Prohibition of Fraudulent and Unfair Trade Practices) regulations, it added.
NON-GENUINE TRADE PRACTICES.
Accordingly, these firms are fined for non-genuine trade practices.
In April 2018, SEBI announced
to take action in a phased manner against 14,720 entities for fraudulent trade
in illiquid stock options segment and passed several orders in past few weeks
against such entities.
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