India markets regulator bars 135 entities over stock manipulation (updated)

Vishal Fabrics

21/06/2023 14:45

(Adds details on stock manipulation, SEBI's caution and details
of its past actions)
       BENGALURU, June 21 (Reuters) - India's markets regulator
on Wednesday issued an interim restraining order on 135 entities
accessing the securities market and fined them about 1.26
billion rupees ($15.36 million for making wrongful gains from
alleged stock manipulation of small-cap companies through bulk
messages.
    In its investigation, the Securities and Exchange Board of
India (SEBI) found a set of entities manipulating shares of five
listed companies - Mauria Udyog  MAUR.BO , 7NR Retail 
 NRRE.BO , Darjeeling  Ropeway Co  DARJ.BO , GBL Industries 
 GBLI.BO  and Vishal Fabrics  VIFA.NS .
    The entities first pushed up stock prices by trading among
themselves and followed it up by sending "buy" recommendations
to the public through bulk messages via texts and websites, the
regulator said.
        As the stocks rose, the entities booked substantial
gains which were transferred back through a web of entities, the
SEBI added. 
  
        The regulator also issued a caution for the wider
public.
  
        "General public is cautioned to be aware of such
fraudulent activities being carried out through SMS messages,
various websites, social media like Telegram, Instagram, YouTube
and are further advised to deal only with SEBI registered
intermediaries," it said.
  
        SEBI has already been cracking the whip on false stock
recommendations through social media platforms, and had, in
April, 
    barred
     six individuals from the securities market for one to three
years for passing false tips on Telegram.
  
        The regulator also 
    plans
     to strengthen its norms to prevent suspicious trading
activities, typically associated with front running, insider
trading and share price manipulation. 
  


($1 = 82.0154 Indian rupees)

 (Reporting by Ira Dugal in Mumbai and Sethuraman NR in
Bengaluru; Editing by Sohini Goswami)
 ((Sethuraman.NR@thomsonreuters.com; (+91 9945291420); Reuters
Messaging: nallur.sethuraman.thomsonreuters.com@reuters.net))