Sebi levies Rs 15 lakh fine on three entities for fraudulent trading activities

The regulator has levied a fine of Rs 5 lakh each on B D Suppliers, Burlington Barter Pvt Ltd and Chunchun Ispat Pvt Ltd.

After observing large-scale reversal of trades in the illiquid stock options segment of the BSE, the Securities and Exchange Board of India (Sebi) conducted a probe between April 2014 and September 2015. The investigation showed that over 81 per cent of all the trades executed in the segment involved reversal of buy and sell positions by the clients and counter-parties that resulted in generation of artificial volumes.

The trades carried out by these entities were non-genuine in nature and created a misleading appearance of trading in the illiquid stock options contracts, where there was negligible participation by the public, the regulator said. After finding that the entities violated the provision of the PFUTP (Prohibition of Fraudulent and Unfair Trade Practices) norms, Sebi penalised them.