Sebi imposes fine Rs 15 lakh on a broker

Market regulator Sebi has imposed a penalty of Rs 1500000 on one Jitendra Mannalal Jain for indulging in fraudulent trading in shares of Asian Star Company Limited (ASCL). According to Sebi (Securities and Exchange Board of India),Jain indulged in circular/reversal synchronised trades with the other brokers and clients in scrips of ASCL. After taking into consideration all the facts and circumstances of the case,Sebi in its order dated October 5 said it was imposing a penalty of Rs 1500000 on Jian,”which will be commensurate with the violations committed by him”. In a probe,Sebi had noticed a spurt of 18% in the price ASCL shares during the period from October 10,2008 to November 20,2008,while the BSE’s benchmark Sensex had fallen by around 20%. Jain had traded carried out synchronised trading in ASCL scrips through the brokers– Emkay Global and B P Equities Private Limited “Gain per se were made by the noticee (Jain) 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. Noting that Jain’s default was repetitive in nature,Sebi said there was substantial number of such trades repeated over a number of days during the investigation period. Further,Sebi noted that monetary penalty was slapped on Jain for fraudulent trading in the matter of RTS Power Corporation Limited through an order dated July 20,2011.