On Wednesday, Sebi banned Bhola Nath Dhall, a former employee of Religare Finvest Ltd, from accessing the capital markets for two years and fined him Rs 6 lakh for directing NBFC trades.
In addition, he was ordered to return Rs 12.34 lakh with interest, the Securities and Exchange Board of India said in its order. Front-running refers to an illegal practice in the stock market where an entity trades based on prior information from a broker or analyst before that information is made available to their clients.
Besides Bhola Nath Dhall, Sebi has held Abhishek Dhall from capital markets for three months.
According to Sebi, Bhola Nath Dhall, who was the Vice President Risk of Religare Finvest Ltd (RFL) was aware of the impending orders from RFL, in which the company would initiate the liquidation of collateral actions of its borrowers/clients for the margin recovery. miss to win.
“Notice no. 1 (Bhola Nath Dhall) took improper advantage of this information which was not publicly available and through the account of Noticee no. 2 (Abhishek Dhall) directed RFL trades, realizing unwarranted gains/avoiding losses up to Rs 12.34 lakh,” Sebi noted.
He further stated that Abhishek Dhall, who was then a student aged around 18-19, had no knowledge of the impending RFL orders and was in no way involved in the dealings that took place on his account and it was Bhola Nath Dhall. , who had placed all passing orders on Abhishek Dhall’s account. “Notice no. 1 had directed RFL’s trades through Noticee no. 2’s trading account, which had authorized notice no. 1 to execute trades on its behalf. Therefore, … notice no. 1 and 2 delivered to the front-end management of RFL trades in violation… of the PFUTP (Prohibition of Fraudulent and Unfair Trading Practices) regulations,” Sebi said in his 33-page order.
Accordingly, the regulator said: “Bhola Nath Dhall (Notice No. 1) is barred from accessing the securities market and further prohibited from buying, selling or dealing in securities, directly or indirectly , or to be associated with the securities market in any way whatsoever, for a term of two years.” The order came after Sebi conducted an investigation into trading activities of Bhola Nath Dhall in the certificates of several companies for the period of May 2015 to April 2016 to determine whether or not he had run on the transactions of RFL, an NBFC providing loans to SMEs.
Sebi last week passed the latest ordinances on front-running issues, while banning former IIFL Group and Fidelity Group dealers.
(Except for the title, this story has no editing by federal government staff and is published automatically from a syndicated feed.)
