Sebi Cracks Down on Front-Running: Madhav Stock Vision Barred

Securities regulator Sebi has banned Madhav Stock Vision from trading using its proprietary account due to front-running allegations. Five individuals are also restrained from trading. Sebi has ordered these entities to disgorge Rs 2.73 crore in illegal gains. The investigation covered trades from April 2020 to December 2023.

In a decisive move, the Securities and Exchange Board of India (Sebi) has barred the stock broker Madhav Stock Vision from engaging in securities trading via its proprietary account, citing accusations of front-running.

This regulatory measure, announced on Wednesday, also restricts five individuals from participating in buying, selling, or dealing in any securities, as per an interim order released by Sebi.

Following an investigation into trades conducted from April 2020 to December 2023, Sebi has mandated these entities to disgorge Rs 2.73 crore gained through illicit trading activities, specifically front-running involving a significant institutional investor referred to as the Big Client. Front-running is an illegal market practice executed by trading on advanced information ahead of large orders.

(With inputs from agencies.)