Sebi fines 2 entities for manipulative trade in BSE stock options segment

Markets regulator Sebi Friday imposed a total fine of Rs 11 lakh on two entities for executing manipulative trades in the illiquid stock options segment on the BSE.

The two entities -- Aakansha Advisory Services and Royal Touch Fablon Pvt Ltd -- were fined Rs 5 lakh and Rs 6 lakh, respectively, as per Sebi's separate orders.

The Securities and Exchange Board of India (Sebi), after observing large scale reversal of trades in stock options segment of the bourse, conducted an investigation between April 2014 and September 2015.

The probe found that more than 80 per cent of all the trades executed in the segment were non-genuine in nature and the two firms were among the various entities that executed such trades by reversing trades with same entities on the same day with wide variation of price.

The trades executed by the two entities were not genuine and being non-genuine, created an appearance of artificial trading volumes, the regulator said.

By doing so, both violated PFUTP (Prohibition of Fraudulent and Unfair Trade Practices) regulations, thereby making them liable for monetary penalty, Sebi said.

Last year in April, Sebi announced to take action in a phased manner against 14,720 entities for fraudulent trades in the illiquid stock options segment and has passed several orders in the past few months against such entities.