Capital markets regulator Sebi on Tuesday levied fines totalling Rs 89 lakh on 15 entities for manipulating the share prices of BFL Asset Finvest Ltd (BAFL).
The entities have to pay the said penalty jointly and severally.
The regulator slapped a fine of Rs 54 lakh on Babulal Hansraj Lakhani, Ramanlal Ravchand Shah, Vinod Solanki, Bhagavatiben Vishnubhai Patel, Dhirajbhai Baladevji Thakor, Bharti Sharma, Pinesh Nareshkumar Shah, Jasmin Indu Shah and Mahendrabhai Naranbhai Patel.
It also imposed a penalty of Rs 30 lakh on Nishant Jain, Pradeep Kumar Jain, Dharmendra Kumar Jain, Dharmendra Jain HUF, Jaipur Infragold and Rs 5 lakh on Rajiv Maheshwari.
The order came after Sebi conducted an investigation into the trading activity in the scrip of BAFL during the period from February 2016 to June 2017.
The shares of the BAFL are listed on the BSE.
During the investigation, the regulator observed certain violations of PFUTP (Prohibition of Fraudulent and Unfair Trade Practices) norms.
In its probe, the regulator found that the entities through their circular and reversal trades have contributed significantly to the share prices of BAFL during the investigation period.
By executing trades, they manipulated the price of the scrip of BAFL on BSE and thus indulged in creating a false or misleading appearance of trading in the scrip.
It was also observed that the entities contributed to the price rise in the scrip by way of trading within themselves and created a misleading appearance of trading in the scrip through manipulative trades among themselves.
By indulging in such acts, the entities have flouted the provisions of PFUTP rules.
Meanwhile, in a separate order, the regulator imposed a fine of Rs 5 lakh on Reddito Capital Investment Advisors (RCIA) and its directors for violating regulatory norms.
RCIA is a Sebi-registered intermediary and its directors are Pankaj Solanki and Abhishek Sharma.
The order came after Sebi conducted an inspection of RCIA for the period from April 2019 to November 2020.
The regulator found that RCIA charged fees from its clients, which was not fair and reasonable, taking into account the client's annual income and/or anticipated investment, thereby violating the code of conduct of IA (investment advisers) norms.
It was also found that RCIA and its directors in several instances did not carry out proper verification of its clients before providing services to them.
Through such acts, RCIA, Solanki and Sharma violated the norms.