Sebi slaps Rs 1.25 cr penalty on 11 entities in REI Agro case

Market regulator Sebi has imposed a total penalty of Rs 1.25 crore on 11 entities, including three promoters, of REI Agro for alleged fraudulent trading in the company's shares during 2004-2005. Sebi has slapped a fine of Rs 10 lakh each on three promoters of REI Agro — Kaushalya Devi Jhunjhunwala, Sangita Jhunjhunwala and Suruchi Jhunjhunwala. The regulator has also imposed penalties on eight other entities connected to REI Agro. It imposed a Rs 15 lakh fine each on — Harrington Commercial, Rajkamal Marketing, Raksha Financiers, Sangita Securities, Hawks Financiers and Pingle Marketing. Two entities, Hi-Fi Tradecom and Right Fiscal Management, were slapped with penalty of Rs 18 lakh and Rs 2 lakh, respectively. The regulator has alleged the entities were matching their trades among themselves through synchronised orders that led to artificial volume in shares of REI Agro and also influenced its share price. Sebi also said it is penalising one of the entities, Hi-Fi Tradecom, for its failure to comply with summons issued by Sebi's investigating authority. The case relates to Sebi's probe into the alleged irregularity in trading of shares of REI Agro from August 9, 2004 to September 16, 2005. The investigation revealed shares of the company witnessed wide fluctuations in price and volume at BSE and NSE during the period.