Banned entities trading via fronts, finds Sebi

The Securities and Exchange Board of India (Sebi) has passed an order against a group of entities involved in manipulation of four stocks using funds from another set of entities already banned by Sebi.  

Sebi examined the activities of the entities involved, collectively called the Jigar Group. They were found to be involved in manipulating the shares of Polytex India

Limited, Gemstone Investments Limited and KGN Enterprises Limited, according to the Sebi order.

The order noted that the substantial trading done by them in the said scrips was not commensurate with their income but was facilitated by transfer of funds from Pabari-Parikh Group entities.

“It is thus, inferred that the… Jigar Group had created substantial trading concentration in those scrips using the funds received from Pabari-Parikh Group entities, which are banned by Sebi,” it said.

The regulator has banned 11 entities from dealing in the securities market pending the passage of a final order in the matter.

Sebi has also stated that in light of the continued indirect dealing by the debarred persons, it may initiate adjudication or prosecution proceedings against four entities for not complying with its earlier directions.