Fraudulent trade: Sebi slaps Rs 45 lakh fine on five entities

Markets regulator Sebi Friday slapped a total fine of over Rs 45 lakh on five entities for carrying out fraudulent trades in the illiquid stock options segment on the BSE.

A One Steel And Alloys Pvt Ltd, Raju Mukund Vanarase, Satya Narain Tulsian, Royal Fincomm Pvt Ltd and A One Steels India Pvt Ltd are the five entities facing action, as per Sebi's separate orders.

Sebi had conducted an investigation into the trading activities of several entities which were suspected to be entering into non-genuine trades in illiquid stock options from April 2014 to September 2015.

The regulator found that the five firms were among the several entities that executed non-genuine trades by reversing trades with same entities on the same day with wide variations in price without any basis for such wide variation.

"Noticee (five entities) had indulged in reversal of trades with its counterparties in the stock options segment of BSE by executing synchronised trades and therefore, such trades were non-genuine trades," Sebi said in separate, but similarly worded orders.

By doing so, the five entities contravened PFUTP (Prohibition of Fraudulent and Unfair Trade Practices) regulations, the regulator said.

Accordingly, Sebi imposed a fine of Rs 15.6 lakh on Raju Mukund, Rs 10.6 lakh on Satya Narain, Rs 7 lakh each on A One Steel and A One Steels India and Rs 5 lakh fine on Royal Fincomm.

The orders are in line with the Securities and Exchange Board of India's (Sebi) announcement in April 2018 regarding taking action in a phased manner against 14,720 entities for manipulative trade in the illiquid stock options segment.