Sebi bars former Tata Finance MD Dilip Pendse for illegal trading

In intensified action against corporate malfeasance, the Securities and Exchange Board of India (Sebi) has barred former Tata Finance managing director Dilip Pendse for two years for having made illegal transactions in stocks of four companies, including Infosys and Telco.

"In this case, I find that Pendse by executing illegal transactions through Inshallah, in the scrips of HPCL, Telco Infosys and Software Solutions India, has violated the provisions of Section 16 of the SCR Act, Regulations 3 and 6(a) of the PFUTP (Prevention of Fraudulent and Unfair Trade Practices),1995," Sebi Member S. Raman said in his order.

The market regulator Monday barred real estate giant DLF and six of its executives, including chairman K.P. Singh, from participating in capital markets for three years for acting to "mislead" investors on the company's public offer.

The order on the Pendse case dating back to over 12 years, also passed Monday, comes into effect immediately.

"The period of prohibition (on accessing capital markets) already undergone by Shri Dilip S Pendse (imposed vide Sebi order dated Dec 24, 2012) shall be taken into account while implementing this order," Sebi said.

Pendse was sacked as Tata Finance chief in 2001 after a company subsidiary incurred massive mark-to-market losses and the Tatas filed criminal charges against him. He was also incarcerated for a while.

Sebi ruled that illegal transactions were conducted by Pendse in complicity with two brokers - Jhunjhunwala Stock Brokers and Pratik Stock Vision - on behalf of Inshallah Investments in which a Tata Finance subsidiary, Niskalp Investment and Trading, had a vital interest.

Pendse had challenged Sebi's December 2012 order with the Securities Appellate Tribunal. Following SAT's directions earlier this year, Sebi gave an opportunity of personal hearing to Pendse and has passed the latest order after looking into all the facts and submissions made before it, the regulator said.