SEBI slaps Rs60 lakh fine on two entities for fraudulent trading
MDT/PTI 18 September 2012

SEBI said Krupa Sanjay Soni and Sanjay Soni sold shares in Shree Global Tradefin acting as a part of a group and thus profited significantly from the offloading

New Delhi: Market regulator Securities and Exchange Board of India (SEBI) has imposed a penalty of Rs60 lakh on two individuals -- Krupa Sanjay Soni and Sanjay Soni -- for alleged fraudulent trading in the shares of Shree Global Tradefin Ltd (SGTL), reports PTI.


Probe carried out by SEBI revealed that SGTL share price recorded a jump of 31.8% in 163 trading days. The investigation covered the period from 23 March 2009 to 20 November 2009.


"The noticees (Krupa Sanjay Soni and Sanjay Soni) have net sold 32,810 shares of SGTL acting as a part of a group and thus profited significantly during the investigation period from the offloading of the shares," a SEBI order dated 14th September said.


The noticees (Krupa Sanjay Soni and Sanjay Soni) along with the other entities of Krupa Soni Group had dealt in the scrip of SGTL in a fraudulent and manipulative manner during the period under investigation that created false and misleading appearance of trading, artificial volume and price manipulation in the scrip, it said.


"... impose a penalty of Rs30 lakh each on the Noticees, amounting to a total of Rs60 lakh under Section 15HA of the SEBI Act...the penalty is commensurate with the default committed by the Noticees," the order added.


Considering the practices indulged in by them and the group entities, the order said the gains per se were made by the two noticees.


They traded in the scrip in a manner meant to create artificial volumes and liquidity which is an important criterion, apart from price, capable of misleading the investors while making an investment decision, SEBI added.


"... anyone could have been carried away by the unusual fluctuations in the volumes and been induced into investing in the said scrip. Besides, this kind of activity seriously affects the normal price discovery mechanism of the securities market," the order said.


Further, the regulator said information on record does not indicate that the violations of Krupa Sanjay Soni and Sanjay Soni are repetitive in nature.

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