SAT has banned broking firm First Global's Shankar Sharma from trading in the equities market for a year

The Securities Appellate Tribunal (SAT) on Friday dismissed the review application filed by First Global Stock Broking Ltd's (FGSB) Shankar Sharma against its order upholding a SEBI order which barred him from accessing the securities market.

According to a PTI report, the (review) application stands dismissed and the ban is with immediate effect, presiding officer Justice N K Sodhi said. SAT would issue the order with full details within a week, he said.

Earlier in February 2009, market regulator Securities and Exchange Board of India (SEBI) barred Shankar Sharma from trading in the securities market for one year for indulging in synchronised trades, buying and selling at the same time, to rig share prices of 10 companies in 2001.

Following the SEBI order, Mr Sharma appealed to the SAT, which stayed the debarment order in March.

Mr Sharma had also appealed to the Supreme Court against the SEBI order in December 2009, which was later dismissed by the apex court in February this year.

SEBI had also rejected an application from First Global's UK-based subsidiary for registration as a foreign institutional investor citing Mr Sharma's poor track record. It had said that keeping First Global UK out from the securities market will not adversely affect the interest of investors.

However, keeping it in the mainstream market after considering the past behaviour of its associate entities may cause prejudice to the interest of investors, it had said.

In the February 2009 order, SEBI's whole-time director MS Sahoo had said, “First Global Stock Broking manager and Vrudhi Confinvest India Pvt Ltd (VCIP) had indulged in large transactions in 10 securities (Global Telesystems, HFCL, DSQ Software, Zee Telefilms, Wipro, Satyam Computers, MTL, SBI, Infosys Technologies and Sterlite Opticals) in early 2001.”

“As these trades for Shankar Sharma in his proprietary account, as a client of Bang Equity on the one hand and the trades of VCIP which is 100% owned by Shankar Sharma and Devina Mehra, as a client of FGSB, resulted in large-scale synchronisation which resulted in creation of large artificial volume in those shares, I hold Shankar Sharma guilty for synchronising the trades in violation of regulation 4 (b) (c) and (d) of PFUTP Regulations, 1995,” Mr Sahoo said in his February 2009 order.

Earlier, on 25 November 2009, Mr Sharma had filed a review petition on SAT's ruling upholding SEBI's ban order, on the grounds that there are certain errors in the records and arguments in the order of the appellate authority.