Sebi imposes fine in Clutch Auto case

Market regulator Sebi today said it has slapped a fine of Rs 100000 on a Hari Krishna Yannam for allegedly indulging in the fraudulent trading practice in the shares of Clutch Auto Limited In its order Sebi (Securities and Exchange Board of India) said it has imposed “a monetary penalty of Rs 100000 on the noticee (Yannam).” The regulator said Yannam was one the clients who traded the most in the scrip of Clutch Auto Limited According to the regulator,he was involved in synchronised trades and had carried out fraudulent and manipulative trades which created artificial volumes and also significantly affected the price of the scrip. Sebi said in a probe it noticed a substantial movement in the company’s share price during the period May 7,2010 to January 31,2011. During the investigation period,Sebi found that Clutch Auto’s scrip opened at Rs 99.25 on May 7,2010 and touched a high of Rs 206 on November 19,2010 then a low of Rs 59.50 on December 09,2010 and close at Rs 85.65 on January 31,2011. “...practices indulged in by the noticee (Yannam)gains per se were made by the noticee in that it traded in the scrip in a manner meant to create artificial volumes and liquidity which is an important criterion,apart from price,capable of misleading the investors while making an investment decision,” Sebi said. It further said that ‘default’ by the entity was not repetitive in nature.