SAT upholds Sebi order on 9 entities in Rich Universe case

Securities Appellate Tribunal today upheld Sebi's order against nine entities in a case related to fraudulent dealings in shares of Rich Universe Network.
In 2013, Securities and Exchange Board of India had imposed a fine of Rs 25 lakh on Scope Vyapar and Rs 3 lakh each on eight other entities after they were found to have executed synchronised trades among themselves in Rich Universe shares. That had led to creation of artificial volume and price manipulation of the company's shares.
Subsequently, Scope Vyapar and other eight entities -- Sankalp Vincom, Anushree Trade Link, Signet Vinimay, Swarn Ganga, Runicha Merchant, D M Trading, J V Stock Broking and BNK Investment Services -- had challenged Sebi's ruling in before the tribunal.

In an order today, the tribunal said that "the appeals are bereft of any merit and are hereby dismissed..."
The tribunal has further directed the entities to deposit the monetary penalty "within a period of two months failing which the respondent (Sebi) shall be at liberty to recover the same with interest as per law".
"The appellants have traded in a huge number of RUNL (Rich Universe Network Ltd) shares via off-market transactions and transferred the said shares in and on-market transactions by way of reversal/synchronised trades within a short span of period," SAT noted in the order.
Sebi investigated the matter pertaining to the period between February 1 and September 24, 2010.

The market regulator had found that group of 21 entities including the nine entities were found to be connected with each other and these entities entered into off-market transactions in the scrip of Rich Universe in large quantities on one hand and executed reversal/circular/synchronised trades among themselves in the market.