SEBI levies Rs 59 lakh fine on 9 cos for fraudulent trading in Turbotech Engineering#39;s scrip

February 18
20:56 2020

Market regulator Sebi on Tuesday levied a total fine of Rs 59 lakh on nine companies for indulging in fraudulent trading in the scrip of Turbotech Engineering Ltd. Radison Properties, Natural Housing, Topwell Properties, South Asia Portfolios, Kingfisher Properties, Janvi Tanvi Shares Traders, Safed Sales, Shivkhori Construction and Spice Merchants are the nine companies on whom the fine has been levied.

Pursuant to a probe conducted by Sebi between October 2012 and January 2015, it was found that the firms had traded with connected entities and contributed significantly towards positive last traded price.

The firms manipulated the price of the scrip by contributing to the price rise and indulged in an act which created false or misleading appearance of trading in the scrip of Turbotech, Sebi noted.

By doing so, the firms violated the Prohibition of Fraudulent and Unfair Trade Practices (PFUTP) norms.

“The acts of manipulating the price of scrip by the noticees have misled and induce gullible and genuine investors to trade in the scrip and harm them and, thus, the fundamental tenets of market integrity get violated with impunity due to such fraudulent acts,” Sebi said.

Accordingly, Sebi imposed a fine on the firms in the range of Rs 1 lakh to Rs 15 lakh.

In May 2019, Sebi had debarred the companies from accessing securities market for seven years.

In a separate order, Sebi barred Crew B.O.S Products Ltd from accessing the securities market for five years in a matter related to manipulation in issuance of global depository receipts (GDR).

Besides, the firm’s officials — Robin Bartholomew and Puneet Nikore — have been barred from securities market for two years.

The firm had issued 1.8 million GDRs amounting to USD 5 million, and all the GDRs were subscribed by only one entity, Fusion Investment, on obtaining a loan from Banco Efisa S.A.

The company acted as guarantor and deposited the entire GDR proceeds with Banco Bank as security against the loan in order to enable Fusion to subscribe to the GDRs issued by the company.

Sebi found that the company misled the investors by making partial and distorted disclosure to the stock exchanges with regard to GDR issue.

Separately, the regulator imposed a penalty of Rs 5 lakh on Akash Ispat Pvt Ltd for executing fraudulent trades in illiquid stock options segment on the BSE, thereby violating PFUTP norms.

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