Sebi slaps Rs 2 lakh on individual for fraudulent trading
Jan 29 2013 , Mumbai
In its order, Sebi said it is imposing "a penalty of Rs two lakh on Nilesh Kothari in terms of the provisions...Of the Sebi (Prohibition of Fraudulent and Unfair Trade Practices Relating to Securities Market) Regulations".
The matter relates to a probe conducted by Sebi in the shares of Empower Industries India Ltd (EIIL) during February 16 — March 11, 2005.
In the investigation, Sebi found that the company’s share surged from Rs 81 to Rs 113 during 18 trading days and total trading volume stood at 2.17 lakh shares.
Kothari had allegedly been party to circular movement and had had aided and abetted EIIL promoter-director Devang Master in manipulating the shares of the company.
Sebi noted that Kothari along with Devang had "carried out transactions in the market that led to a rise in the volume of the scrip and thereby induced the gullible investors".
"...It does not appear to be a mere coincidence that the company made false announcements that facilitated in creating a general interest in the scrip and helped Devang and the noticee in carrying out their nefarious designs," Sebi said.