SEBI levies nearly Rs 23 lakh fine on 16 entities

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Markets regulator SEBI has imposed a total fine of nearly Rs 23 lakh on 16 entities for violation of market norms while dealing in the scrip of Timbor Home Ltd. The entities entered into off-market transactions without making the payment of considerations within the timeline as stipulated under the Securities Contracts Regulation Act (SCRA).

In another investigation conducted by SEBI in the scrip of Timbor Home between April 2014 – May 2015, 21 entities who were allegedly connected and had allegedly acted in concert as part of a scheme to plant unsolicited and misleading advice, recommending purchasing the company’s shares to induce unsuspecting investors to buy the scrip and thereafter offloading a large number of shares in the secondary market pursuant to such misleading recommendation.

The modus operandi included the off-market transfer of shares of Timbor Home by certain promoters of the company to other connected entities and in turn, the connected entities sold the shares in the market.

Analyzing the data regarding off-market transactions, SEBI noted that the off-market dealings of the entities in the scrip of Timbor Home were not in conformity with the SCRA norms.

Besides, certain entities also failed to furnish the information sought by the regulator.

For violation of market norms, the 16 entities are facing a fine in the range of Rs 1 lakh to Rs 2.2 lakh.

In a separate order, SEBI has warned Shri Parasram Holdings Pvt Ltd “to exercise caution, care and due diligence in its future conduct as a stockbroker in all its dealings with its clients and to ensure compliance with the applicable laws at all times in future”.

The order came after SEBI inspected the books of accounts and other records of the broker for the period April 1, 2012, to January 20, 2014, to verify whether it had complied with the regulator’s circular.