Sebi's Stern Action: A Five-Year Bar for Front-Running Entities

Sebi has barred 12 entities from securities markets for five years, imposing Rs 90 lakh in penalties for front-running. They must disgorge Rs 1.07 crore with interest to the Investor Protection Fund. The order reveals insider information misuse led to unfair trading, violating Sebi's regulations.

The Securities and Exchange Board of India (Sebi) has taken decisive action against 12 entities involved in a front-running scandal, barring them from the securities markets for five years. Additionally, the regulator imposed penalties amounting to Rs 90 lakh on the accused for their fraudulent activities.

Sebi's exhaustive 102-page order uncovered how Paresh N Bhagat, leading Mangal Keshav Financial Services, utilized dealers with non-public information to execute unfair trades. The information was further shared with other entities, leading to unscrupulous trading ahead of the market.

The punishments don't end with market bars. The entities are required to return unlawful gains of Rs 1.07 crore with 12 percent interest to the Investor Protection Fund, and individuals face additional industry bans, marking a firm stance by Sebi on maintaining market integrity.