Sebi levies Rs 10 lakh fine on stock broker

Capital market watchdog today imposed a penalty of Rs 10 lakh on MTL Share and Stock Brokers (now known as Master Capital Services) for violating stock broker regulations related to trades in four company scrips.
According to the Securities and Exchange Board of India (Sebi), MTL Share had executed self trades on behalf of one of its client in shares of Nakoda Textiles India, Gayatri Projects, Nandan Exim and Trimurthi Drugs and Pharmaceuticals.
"I conclude that the nexus between the noticee (MTL Share) and its client Dhirajlal V Sanghvi (HUF) is clearly established in executing the self trades and that the noticee has failed to carry out its business with due skill, care and diligence in violation of...The stock brokers regulations," Sebi adjudicating officer D Sura Reddy said.

"...Hereby impose a penalty of Rs 10 lakhs on MTL Share and Stock Brokers Ltd( presently known as Master Capital Services Ltd)," Reddy added.
Sebi had carried out an investigation during the period from July 1, 2009 to January 19, 2010 into the trading activity of certain entities referred to by the watchdog as "Sanghvi Group" for the possible violation of the various market regulator's norms.
The regulator found that MTL Share being a stock broker had executed self trades on behalf of Dhirajlal (HUF). The broker had on behalf of its client executed 29 self trades in the 4 scrips for a total volume of 27,708 shares over a period of 7 months.