SAT upholds Sebi ban on KP for 14 yrs

Securities Appellate Tribunal (SAT) today upheld an order of market regulator Sebi, debarring tainted stock broker Ketan Parekh and seven others from trading in the market for a period of 14 years on the charges of executing illegal and manipulative transactions in the 2000 stock scam. The others are Kartik Parekh, Luminent Investment, Chitrakoot Computers, Classsic Infin, Classic Credit, Panther Fincap and Saimangal Investrade. However, SAT criticised the Sebi move to let off Credit Suisse First Boston (India) Securities and Dresdner Kleinwort Benson Securities with a smaller penalty. Parekh — who was involved in manipulative deals and defaulted on payment to banks — had challenged a December 2003 order by Securities and Exchange Board of India, prohibiting him and seven co-related entities from trading. The three-member tribunal, headed by sat Justice N.K. Sondhi, observed, ‘‘Ketan Parekh had rigged the market in a big way and the penalty imposed on them was quite reasonable having regard to the gravity of the charges proved against them. Hence, we find no ground to reduce the period of debarment and the appeals stand dismissed’’. At the same time, SAT also criticised Sebi for letting off lightly the two brokers Credit Suisse First Boston (India) Securities Private Limited and Dresdner Kleinwort Benson Securities for debarring them for a period of 18 months and two years respectively. “Sebi was not justified in letting off the two brokers lightly by imposing on them a penalty which was clearly disproportionate to the gravity of charges proved against them.”