NEW DELHI: Sebi has imposed penalties of Rs 2.8 crore on 18 entities and barred them from the securities markets for up to five years for rigging the share prices of Retro Green Revolution Ltd (RGRL).
Additionally, the regulator has directed 15 of these entities to disgorge total ill-gotten gains worth Rs 2.94 crore, along with 12 percent interest per annum from December 31, 2021, till the date of payment.
The amount will be deposited in Sebi’s Investor Protection and Education Fund within 45 days.
In its 61-page order passed on Tuesday, the regulator found that the entities were part of a premeditated scheme to artificially inflate the price of an illiquid RGRL scrip and lure gullible investors.
Sebi observed that the scheme involved trading between related entities to create artificial volumes in a thin stock, followed by circulation of stock tips/recommendations through a Telegram channel.
Notifications No. 1 to 6, including Sanjay Arunkumar Choksi, had indulged in creating a fraudulent appearance of securities trading and also manipulated the price of the security, the Securities and Exchange Board of India (Sebi) said in the order.
The markets watchdog noted that the Choksi Group, led by Sanjay Choksi, played a key role in the manipulation.
Although Choksi was no longer the promoter of RGRL, the company continued to be controlled by him as all legal payments were being drawn from his account.
“I find that notification No. 1 (Choksi) did not act in good faith and used his influence in the company for personal gain.
“The increase in the volume of shares in the otherwise illiquid scrap of RGRL and the telegram recommendation are indicators that affect the investment decision that influence investors in the trading of shares,” Sebi’s Quasi-Judicial Authority Santosh Shukla said in the order.
