Sebi impounds Rs 1.4 crore in Gammon insider trading case

Directs banks to impound bank accounts of all persons and companies, except transfer of funds to the escrow account

The Securities and Exchange Board of India (Sebi) has seized nearly Rs 1.4 crore from Abhijit Rajan, former chairman and managing director of Gammon Infrastructure Projects Ltd (GIPL) and three others, for allegedly violating insider trading norms.

"With the initiation of investigation and quasi-judicial proceedings, it is possible that Rajan, Consolidated Infrastructure Company Private Limited (CICPL), and its directors Kiran Hingorani and Indru Hingorani may have diverted the unlawful gains, which may defeat the implementation of the direction of disgorgement, if any, to be passed after adjudication on merits," Sebi whole-time member Prashant Saran said. Sebi has also directed banks to impound bank accounts of all persons and companies, except transfer of funds to the escrow account. In July 2014, Sebi barred Rajan after finding him guilty of insider trading and dealing in securities of Gammon Infra unfairly on the basis of privileged unpublished information. In the present case, Sebi found Rajan, being an "insider", had access to the "unpublished price sensitive information" and he dealt in the shares of GIPL on the basis of that during August-September 2013 period.

Sebi had begun its probe based on inputs from National Stock Exchange (NSE) that "there is a possibility that certain clients might have traded on the basis of unpublished price sensitive information" in shares of GIPL.