Sebi slaps fines worth Rs 65 lakh on 13 entities for manipulative trades

Markets regulator Sebi has imposed a total penalty of Rs 65 lakh on 13 entities for manipulating the share price of Jaisukh Dealers Ltd.

The Sebi conducted an investigation into the trading activities of Jaisukh Dealers Ltd (JDL) between February 2014 and July 2016 to ascertain the possible violation of PFUTP (Prohibition of Fraudulent and Unfair Trade Practices) norms.

The regulator found that 13 entities manipulated the price of JDL and of these entities, two booked gains by selling their shares at artificially high prices.

"Noticee 1 to 13 by trading amongst themselves have manipulated the price of JDL in violation... of PFUTP norms," the Securities and Exchange Board of India (Sebi) said in its 55-page order on Thursday.

The share price of JDL, which is listed in the SME-ITP of BSE, shot up from Rs 25 to Rs 325 in 23 trades carried out over 17 days from February-July, 2014.

Sebi noted that JDL had 1,166 shareholders in March 2014 and 1,205 stakeholders in September 2014 and the stock was thinly traded, and with the limited number of shareholders, there was limited public participation.

Further, it said that despite the high price remaining stable for a considerable period of time, even after the investigation period, there were hardly any sellers appearing to profit from the price.

In its order, the regulator imposed a penalty of Rs 5 lakh each on the 13 entities taking the total amount to Rs 65 lakh.

These entities are Keynote Painting Dealers, Panchshree Logistics, Yogesh Bansal, Manoj Parasrampuria, Crown Iron Merchants, Glorious Vincom, Jatan Mercantiles, Innova Auto Distributors, Kanika Jain, Anita Jajodia, Linkup Financial Consultants, Sabita Jajodia and Rajendra Hukumchand Gupta.