Regulations
SEBI imposes Rs10 lakh penalty on a brokerage firm

SEBI said that the stock broker has failed to show high standards of integrity, promptitude and fairness as well as failed to act with due skill, care and diligence in the conduct of the business

 
Mumbai: Market regulator SEBI imposed a penalty of Rs 10 lakh on a brokerage firm Jitendra Harjivandas Securities for allegedly facilitating fraudulent trading practices in shares of Betala Global Securities (BGSL), reports PTI.
 
Securities and Exchange Board of India (SEBI) said the stock broker indulged in circular/reversal synchronised trades with other brokers and clients in the shares of Betala Global Securities.
 
“...impose a total penalty of Rs 10 lakh on the noticee (Jitendra Harjivandas Securities)...the penalty is commensurate with the default committed by the noticee,” SEBI said in its order.
 
In a probe conducted by SEBI, the regulator found a spurt in the share price of BGSL during 2 May to 21 November 2003. The regulator said that the company's scrip price jumped by 254% and a total of 1.54 crore shares were traded.
 
SEBI said a group of clients connected to each other i.e., Mahesh Mistry traded in the shares of the BGSL through various trading members and mostly through Jitendra Harjivandas Securities.
 
“...the noticee as a stock broker have indulged in manipulative and fraudulent transactions and created a false market of shares of the company by acting in concert with the entities of Mahesh Mistry Group,” the regulator said.
 
It further said the stock broker has failed to show high standards of integrity, promptitude and fairness as well as failed to act with due skill, care and diligence in the conduct of the business.
 

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SEBI fines 3 entities for violating disclosure norms

In three separate orders, SEBI said it has imposed a fine Rs50,000 on JMD Telefilms Industries, another Rs75,000 on a Avishek Bose and slapped a penalty of Rs45,000 on Gulistan Vanijya Pvt Ltd

Mumbai: SEBI has imposed a total penalty of Rs1.70 lakh on three entities for not making requisite disclosures related to shares of Livingroom Lifestyle.

 

In three separate orders, Securities and Exchange Board of India (SEBI) said it has imposed a fine Rs50,000 on JMD Telefilms Industries, another Rs75,000 on Avishek Bose and slapped a penalty of Rs45,000 on Gulistan Vanijya Pvt Ltd.

 

SEBI in the orders dated 31 October 2012 said that considering the facts and circumstances of the case the penalty “shall be commensurate with the violations committed by the noticee.”

 

Pursuant to receiving a complaint, SEBI initiated an probe in the scrip of Livingroom Lifestyle (now known as Chisel & Hammer Mobel Ltd) for the period 11th February to 25th November 2010.

 

The regulator said Avishek Bose was the top client who contributed 9.95% to the gross market buy. Bose had 8.27% stake in the Livingroom Lifestyle which were purchased from the two of the company’s promoters.

 

SEBI alleged that Bose transferred his stake to Gulistan Vanijya which subsequently gave them to JMD Telefilms Industries.

 

None of the three entities, however, made any disclosure regarding their shareholdings as required under the norms.

 

SEBI said failure on the part of the entities to make the necessary disclosures on time had deprived the investors of the important information at the “relevant point of time.”

 

The regulator said it observed that the entities had “concealed the vital information which was detrimental to the interest of investors in securities market.”

 

In an another order, the market regulator has slapped a Rs1 lakh fine on Abhigam Consultants for failing to disclose the share acquisition in formations to the stock exchanges in the prescribed time period of four days.

 

The matter relates to acquisition of shares/voting rights of Transpek Finance by Abhigam Consultants in December last year.

 

“...impose a consolidated penalty of Rs1 lakh...on the noticee (Abhigam Consultants)...penalty is commensurate with the violations committed by the noticee,” SEBI said in its order.

 

SEBI said Abhigam Consultants on 5 December 2011 acquired 5.59 lakh shares/voting rights amounting to 15.66% stake in Transpek Finance through inter-se transfer of the shares on 5 December 2011.

 

The regulator said the entity failed to inform the same to the stock exchanges within the prescribed period of four working days and informed the information only on 31 January 2012—a delay of 36 working days.

 

SEBI said it had granted an exemption to the company from making public offer on account of inter-se transfer of the shares among the qualifying persons.

 

In addition, as per SEBI’s regulation, the entity was required to intimate the stock exchange where the shares of the target company are listed, about the details of the proposed acquisition at least four working days prior to the purchase.

 

“However, it is observed that the noticee undisputedly failed to intimate the same within the prescribed period, and intimated only on 31 January 2012 i.e. a delay of 44 working days,” SEBI said.

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GSB Securities settles SEBI charges for Rs28 lakh

"SEBI in its consent order dated 31 October 2012 said that “enquiry proceedings initiated against the applicant (GSB Securities) for the non-compliance of provisions...stand settled and SEBI shall not initiate any enforcement action against the applicant for the same”

 
Mumbai: Market regulator Securities and Exchange Board of India (SEBI) disposed of a case against GSB Securities after the entity made a payment of Rs28 lakh to settle charges related to violations of broker regulations, reports PTI.
 
SEBI in its consent order dated 31 October 2012 said that “enquiry proceedings initiated against the applicant (GSB Securities) for the non-compliance of provisions...stand settled and SEBI shall not initiate any enforcement action against the applicant for the same.”
 
A probe conducted by SEBI had found that GSB Securities had acted as an unregistered portfolio manager on behalf of two individuals Praveen Daga HUF and Chitra Vishwanath.
 
SEBI had alleged that the broker could not produce letter of authorisation from the two clients.
 
The broker proposed settlement under SEBI’s consent order mechanism on 27 February 2012.
 
Thereafter, a High Powered Advisory Committee (HPAC) considered the consent terms and recommended the case for settlement on payment of Rs28 lakh. The same was approved by a panel of whole time members of SEBI.
 
SEBI noted that enforcement actions, including commencing or reopening of the proceedings, could be initiated if any representation made by GSB Securities is found to be untrue.
 

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