Sebi Expels Brokers For Price Rigging

The Securities & Exchange Board of India (Sebi) has debarred promoters of several companies and a group of share brokers from participating in the securities market for a period ranging one year to five years, for their involvement in market manipulation and price rigging.

All the promoters and errant brokers were booked under the SEBI (Prohibition of Fraudulent and Unfair Trade Practices Relating to Securities Markets) Regulations, 1995.

Sebi sources said it had frozen the unlawful gains earned by the broking firms namely Madhuvan Trades & Fin., Magnificent Apts. (now Richhold Apartments ), Richhold Properties, Mayank Properties & Finance. (now Richhold Enclave & Finance), Shankarlal Saraf, Zircon Properties (now Richhold Trading) Global Trust Finance Corporation and Progressive Tea Management.

The charges against Virtue Financial Services and its managing director were they were instrumental in rigging share prices of Amtek (Inia) Ltd.

Sebi found the charges tenable and therefore prohibited the Virture Financial Services and its managing director from dealing in securities for a period of one year with effect from March 1, 2002.

Based on an information of Delhi Stock Exchange, the market regulator investigated into the abnormal price hike on Hindustan Finstock Ltd and found R K Patel responsible for the price manipulation. The punishment in case of Patel is that Patel will not be allowed in dealing in securities for a period of one-year beginning March 1, 2002.

SEBI initiated investigations into the price manipulation of Adeshwar Cotton Ltd from Rs. 45 a piece to Rs. 215. Investigations revealed that Kanan Dalal Securities Ltd, R. K. Patel and Shailesh Thakkar were responsible for creating a false market and artificial rise in the price of the scrip. Sebi barred them from entering in the market for a period of one years.

The market regulator has prohibited Vimal Raj Mathur, promoter of the Hyderabad-based V. R. Mathur Mass Communications Ltd, for price manipulation in the public issue of the company from dealing in securities and access capital market for a period of five years. The verdict was effected from February 19, 2002.

The market regulator found that eight broking outfits acted in concert to create a false market in the share of Cox & Kings (India) Ltd (previously Cox & Kings Travel and Finance Ltd) in February 1996. Sebi expelled them from securities market for a period of one year.