Two individuals pay over Rs 51 lakh to settle insider trading case

Two individuals have paid more than Rs 51 lakh to markets regulator Sebi to settle a case of insider trading in shares of UFO Moviez India Ltd.

The amount remitted by them includes settlement charges, ill-gotten gains and the interest amount, according to a Sebi order.

Chirag Negandhi, who had possession of Unpublished Price Sensitive Information (UPSI) allegedly passed on the information to his wife Nidhi Negandhi who in turn traded in UFO Moviez India's shares based on the UPSI, the order stated.

In November 2017, UFO Moviez India had informed the exchanges regarding announcement of combination of its businesses with that of Qube Cinema Technologies Pvt Ltd.

The information was considered as UPSI and the period of UPSI was February 1, 2017 to November 1, 2017. Chirag Negandhi who was in possession of the UPSI was alleged to have communicated the information to Nidhi who bought 20,000 shares of UFO during the UPSI period and sold them immediately after the announcement.

The individuals filed a settlement application with the regulator, proposing to settle, without admitting or denying the findings of fact and conclusions of law.

The proposed settlement terms were considered by the high powered advisory committee of Sebi which recommended the case for settlement on payment of Rs 21.93 lakh by Chirag and Rs 19.68 lakh by Nidhi along with ill-gotten gains of Rs 7.08 lakh and an interest of Rs 2.87 lakh.

The individuals remitted their respective amounts in June, Sebi noted in an order dated July 06.

Thus, Sebi ordered that the ''proceedings that may have been initiated for the alleged defaults ...are settled qua the applicants'' as per certain terms.