SEBI imposes Rs 2 lakh fine on Crystal Finstock
Mumbai: Market regulator SEBI has imposed a penalty of Rs 2 lakh on Crystal Finstock for violating broker regulations and indulging in fraudulent practices in the shares of Popular Estate Management.
SEBI in its order said that it is imposing a penalty of Rs 1 lakh on Crystal Finstock for violating regulations on fraudulent trade practices and another Rs 1 lakh for violating code of conduct for sub-brokers.
The regulator in its order dated October 25 said that the penalty "shall be commensurate with the violations committed by it (Crystal Finstock)".
SEBI said: "the noticee (Crystal Finstock) placed synchronised orders... In Popular Estate Management shares in a manner meant to do profit and loss adjustment and to create artificial volumes."
SEBI said in a probe conducted by it in the shares of Popular Estate Management during the period from February 9 to February 24, 2009 it was found that certain entities had executed trades among themselves in significant variation to the Last Traded Price (LTP) in the shares of the company.
These entities had executed the trades through sub-broker Crystal Finstock of broker Mehta Equities Ltd, he added.
SEBI said it found that Crystal Finstock had executed synchronised reversal trades for 58,000 shares which accounted for over 98 percent of the total traded volume on three trading days during the period of examination.