SEBI bans three brokers for price-rigging

Three brokers of the Bombay Stock Exchange (BSE) have been prohibited by the Securities and Exchange Board of India (SEBI) from dealing in securities in any manner for a five year period with effect from December 10 last for alleged price manipulation in the scrip of Gujarat Cotex. According to the SEBI, the three brokers — Amrish Valia, Rajan P Mehta and Dimple Shah– were allegedly responsible for creating a false market and artificial rise in the price of scrip between July 12 and August 28. The regulator initiated investigations when the scrip price had moved from Rs 18 to Rs 180 and it was revealed that the three brokers had dealt in the said scrip with “an intention to manipulate the prices of the said shares,” SEBI said in a statement today. A notice was issued under Regulation 11 read with Regulation 12 (A) of SEBI (prohibition of fraudulent and unfair trade practices relating to securities market) regulations, 1995 read with Section 11 (b) of the Sebi Act, 1992. They werealso given an opportunity to appear before the Chairman of Sebi for personal hearing, which was not availed by them. After careful examination of records and relevant material, SEBI passed the order prohibiting them from dealing in any securities for five years, the statement said.