sebi: BSE stock option segment: Sebi fines Morissons Traders and Developments for fraudulent trading

New Delhi: Markets regulator Sebi on Friday levied a fine of Rs 10 lakh on Morissons Traders and Developments Pvt Ltd for indulging in fraudulent trade in the illiquid stock options segment of the BSE. The order follows an investigation conducted by Sebi between April 2014 and September 2015.

During the investigation period, it was revealed that over 81 per cent of all the trades executed in the segment involved reversal of buy and sell positions by the clients and counterparties in a contract.

Morissons Traders and Developments was one such client that engaged in non-genuine transactions, creating a misleading impression of trading in respective contracts while dealing in stock options contracts in a fraudulent manner.

The firm violated the Prohibition of Fraudulent and Unfair Trading Practices (PFUTP) norms and thus faces a fine of Rs 10 lakh.

Through two separate orders, Sebi imposed a fine of Rs 5 lakh each on two individuals, Parag Ramesh Kalwankar and Amit Chouhan, for manipulating the price of Hasti Finance Ltd’s scrip and created a misleading appearance of trading in the scrip.

“It is established that the noticee manipulated the price of the scrip and created a misleading appearance of trading in the scrip by placing buy orders in small quantity and above LTP, which are not trades executed in normal course of trading and investment in securities market,” Sebi said for the individuals in similarly worded separate orders.

LTP refers to last-traded price.

Consequently, Sebi levied a monetary fine for violating PFUTP norms.

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