Front Running

Front running case: Sebi bans 5 from mkts for 1 year, impounds Rs 1.53 cr

Capital markets regulator Sebi on Friday barred five individuals from the securities markets for one year and directed them to impound illegal gains of nearly Rs 1.53 crore made from their front-running activities. The regulator also imposed a penalty of Rs 10 lakh on Nikhil Khaitan, and Rs 5 lakh on Om Prakash Khaitan, Manju Khaitan, Neha Khaitan, and Nidhi Tibrewal. Front-running refers to an illegal practice in the stock market where an entity trades based on advanced information from a broker or analyst before the information has been made public. "... noticee No 1 (Nikhil Khaitan), while being dealer of the Big Clients and having knowledge of... impending orders, front ran the trades of big clients by using trading account of the FRs (Noticee No. 2, 3, 4 and 5) during the IP (investigation period) and gained benefit from non-public information," Sebi said in a 49-page final order. Sebi also stated that the noticees in the process of front running trades of the big client have

Two individuals pay Rs 91 lakh to settle front-running case with Sebi

Two individuals on Wednesday settled a case pertaining to an alleged front-running with Sebi by paying a settlement fee of Rs 91 lakh. Apart from the settlement amount, these two individuals -- Meghana Gosar and Devan Sangoi -- have to comply with other conditions to settle the matter, the capital markets regulator said. One of the conditions included a disgorgement amount of Rs 27.77 lakh to be paid by Gosar. The disgorgement amount is to be paid along with 12 per cent per annum from the date of violation (April 30, 2022) till the date of filing of the settlement application, Sebi said in the settlement order. Also, Gosar and Sangoi will voluntarily debarred themselves from accessing as well as dealing in the securities markets for six months. The order came after the applicants proposed to settle by neither "admitting nor denying the findings of fact and conclusions of law" by filing two separate settlement applications. "In exercise of the powers...in terms of the settlement .

What is front-running scam and what is Ketan Parekh’s role?

Decoded: How does front-running work, and what is Ketan Parekh's role?

Front-running is a fraudulent practice where traders use advance knowledge of large client orders for personal profit, as seen in Ketan Parekh's case

Front-running case: Sebi bans 9 entities, impounds Rs 21 cr illegal gains

Markets regulator Sebi has uncovered a front-running scheme involving PNB MetLife India Insurance Company equity dealer Sachin Bakul Dagli and eight other entities, who generated illegal gains of Rs 21.16 crore. The front-running by these entities continued for more than three years. Sebi, through an interim order on Friday, prohibited Sachin Bakul Dagli and eight other entities from the securities market and impounded the unlawful gains made by them. The Securities and Exchange Board of India (Sebi) had conducted an examination into the suspected front running of the trades undertaken by the Big Client, PNB Metlife India Insurance Company Ltd, by certain entities. The focus of the investigation was to ascertain whether the suspected entity(ies) had front-run the trades of Big Client in connivance with other entities, including dealers and/or fund managers, if any, and thereby violated the provisions of the Sebi's PFUTP ( (Prohibition of Fraudulent and Unfair Trade Practices) rules

Axis Securities settles front-running case with Sebi; pays Rs 14.62 lakh

Axis Securities on Wednesday settled a case, involving front-running trades by its former employee Vikrant Bhimrao Kadam and his friend, with markets regulator Sebi after paying Rs 14.62 lakh towards settlement amount. It was alleged that as a stock broker, Axis Securities failed to exercise appropriate due diligence in the matter in its dealer and branch manager compliance policy. The order came after Axis Securities filed an application with Securities and Exchange Board of India (Sebi) proposing to settle the violation of broker regulations "without admitting or denying the findings of fact and conclusions of law". In its settlement order, Sebi said the broker remitted the settlement amount of Rs 14.62 lakh and consequently the instant "proceeding initiated against the applicant (Axis Securities) vide show cause notice dated June 4, 2024 is disposed of". In a statement, Sebi clarified that the alleged frontrunner Mandar Ulhas Bhatkar has not been an employee of or associated wit

Explainer: What is front-running, how does it impact MF or its investors

Sebi uses various algorithms, data analytics, and supervision technology to track instances of front-running and insider trading

Who is Sandeep Tandon, what is front running? All about Quant Mutual Fund

Sebi is reportedly investigating charges of front running at Sandeep Tandon-owned Quant Mutual Fund.

Front running case: Sebi bans 8 cos; impounds 'unlawful gain' of Rs 1.3 cr

Markets regulator Sebi on Friday barred eight entities from the securities markets and impounded "unlawful gains" of Rs 1.3 crore earned by them from front-running activities. The eight entities are Ashok Maheshwari, Darshan Bakul Shah, Khusboo Darshan Shah, Darshan Bakul Shah (HUF), Benzer Department Stores Pvt Ltd, CHL Stock Concepts Pvt Ltd, Chirag Mahendra Shah, and Mihir Dhirajalal Savla. Front-running refers to an illegal practice in the stock market where an entity trades based on advance information from a broker or analyst before the information has been made available to its clients. Ashok Maheshwari was one of the dealers of stock broker ABC Securities Ltd, and was responsible for placing trading orders for the Big Client, which was engaged in the business of portfolio management services. In its 77-page order, Sebi found that Ashok Maheshwari was instrumental in supplying the information about the impending trades of the Big Client to Darshan Bakul Shah and such ...

Sebi bans two persons from market for 3 years, slaps Rs 77 lakh penalty

Sebi on Tuesday barred two individuals from the securities market for three years and imposed a penalty of over Rs 77 lakh on them for their involvement in front-running. Front-running refers to an illegal practice in the stock market where an entity trades based on advanced information from a broker or analyst before the information has been made available to its clients. Those restrained by the Securities and Exchange Board of India (Sebi) are -- Rohit Mankotia, who was employed in Radico NV Distilleries, and his mother Shila Devi. Further, Mankotia was on deputation to Sapphire Intrex Ltd (Big Client) and his work is related to technical analysis of stocks for Sapphire. Sapphire is the promoter of Radico Khaitan Ltd (RKL) and held 33.95 per cent equity shares of RKL, as per Sebi order. Additionally, the two persons have been directed to disgorge Rs 38.8 lakh within 45 days and the same will be credited into the Investor Protection and Education Fund (IPEF). In its 65-page orde

Front running case: LIC fires employee banned by Sebi from stock market

Markets regulator Sebi had last year found that a dealer in LIC, was in possession of non-public information regarding impending orders of LIC and acted as an information carrier

Market regulator Sebi bars five for front-running trades in LIC

In an interim order issued on Thursday, Sebi noted that Yogesh Garg, an employee in the investment department of LIC, and four others connected to him made unlawful gains of Rs 2.44 crore

Two entities settle front running case with Sebi; pays Rs 67.62 lakh

Labdhi Enterprises and Falguni Ketan Parekh have settled with Sebi a case pertaining to alleged front running of trades of Tata Absolute Return Fund after a payment of Rs 67.62 lakh as settlement amount. Tata Absolute Return Fund is a scheme of Tata AIF (Alternative Investment Fund). The settlement came after Labdhi Enterprises and Parekh filed a joint settlement application to settle the pending proceedings "without admitting or denying the findings". "The proceedings that may have been initiated for the alleged violations ... are settled qua the applicants," Sebi said in its settlement order passed on Friday. As per the order, the Securities and Exchange Board of India (Sebi) conducted a preliminary examination to ascertain that certain entities had been front running the trades of Tata Absolute Return Fund (TARF) between December 2019 and August 2020. Thereafter, Sebi passed an interim order in August 2020, directing the applicants to deposit the proceeds that they had made fro

Sebi's front-running investigations rise even as overall cases dip

More probes were completed than in the previous year

Axis Mutual Fund probe: I-T dept raids ex-fund manager Viresh Joshi's house

Joshi was sacked in May by the Axis Asset Management Company over allegations of front running

Axis AMC sacks chief dealer Viresh Joshi over front-running allegations

The reason for termination was not given. Earlier, Axis AMC had also suspended Joshi and Deepak Agarwal

Should recent events at Axis Mutual Fund worry India's retail investors?

Two fund managers at Axis Mutual Fund were stripped of their responsibilities recently over suspicion that they were involved in front-running. Is it just a stray incident? Or, the tip of an iceberg?

IIFL Group case: Sebi refuses to lift capital market ban on 6 individuals

Sebi on Tuesday refused to lift the capital market ban imposed on six individuals for 'front running' the trades of India Infoline Group

Sebi slaps Rs 2 cr fine on 4 entities in HDFC AMC front-running case

The regulator levied a fine of Rs 50 lakh each on Nilesh Kapadia and Dharmesh Shah, Rs 40 lakh on Ashok Nayak and Rs 60 lakh on IKAB Securities and Investments Ltd.

SC upholds Sebi order against 3 defaulters in 'front-running' cases

The Supreme Court has upheld a 2011 order by Securities and Exchange Board of India (Sebi) giving it a boost while prosecuting 'front running' cases. Front running means buying or selling of securities ahead of a large order so as to benefit from the subsequent price move. Sebi's powers in the matter came under cloud after the Securities Appellate Tribunal (SAT) in 2012 struck down the regulator's order against Dipak Patel, an employee of a Mauritius based fund manager and his relatives, who executed trades based on information passed on by him. SAT's position was that the front running rules could not invoked for persons other than the intermediary. Allowing Sebi's appeals on Wednesday, the bench of NV Ramana and Ranjan Gogoi said, "Taking into consideration the facts and circumstances of the case before us and the law laid down herein above and SEBI v. Kishore R. Ajmera (Supra) can only lead to one conclusion that concerned parties to the transaction were involved in an apparent ...