The Securities and Exchange Board of India (Sebi) has levied a total penalty of Rs 55 lakh on 11 entities for indulging in non-genuine trades in illiquid stock options on the BSE.
The regulator slapped 11 separate orders of Rs 5 lakh each on Kamla Devi Bajoria, Kamala Agarwal, Kamal Kumar, Kamaljeet Kaur, Kamal Ramprasad Gupta, Kamal Jain, Kailash Narottamdas Anam, Kamlesh Ahuja, Sanjay Kumar Daga HUF Pragma Suppliers Pvt Ltd and Aromatic Tie Up Pvt Ltd.
The orders were issued after Sebi observed large-scale reversal trades in the illiquid stock option segment on the Bombay Stock Exchange (BSE) that led to artificial volumes on the exchange.
An investigation was conducted into the trading activities of certain entities engaged in the segment from April 2014 – September 2015.
The entities who were fined are those involved in reversal trades.
Reversal trades are non-genuine trades as they are executed in the normal course of trading, leading to false or misleading volumes.