Saturday, June 6, 2009

Sebi bars eight entities for rigging in RTS Power

Market regulator Sebi on Friday barred eight entities, including six individuals and two firms, from dealing in the stock market till
further notice, for allegedly rigging the share price of RTS Power Corporation.

Those barred are Mukesk G Konde, Ashok Narayan Waje, Nitesh Ashok Jadhav, Hetal Patel, Rajesh Patel, Chetan Shah, Om Associated and Bhavani Trading Company. Of these, Hetal Patel, Om Associated and Bhavani Trading Company figure on the list of entities banned by Sebi for their alleged involvement in the manipulation of the Pyramid Saimira stock.

Earlier this year, Networth Stock Broking, Geojit Financial Secs, Dawnay Day AV, and Tata Securities had complained to Sebi that Mr Konde, Mr Waje and Mr Jadhav had placed ‘buy’ orders in RTS Power and then disappeared without making any payment.

After consultation with Sebi, BSE had withheld the payout, amounting to Rs 9.85 crore, to the sellers of the block of RTS shares, that were bought by Mr Konde, Mr Waje and Mr Jadhav. It was suspected that the fake buy orders were placed with an aim to provide an exit to the sellers, who were part of the fraud.

However, the decision of BSE was challenged by Ms Hetal Patel — one of the sellere — before the SAT. SAT, in turn, directed BSE that Rs 3.44 crore should be deposited in a fixed deposit with a nationalised bank, till such time the appeal is finally disposed of by the Tribunal body.

"I find that Mr Konde, Mr Jadhav, Mr Waje and Ms Hetal Patel and Rajesh Patel prima facie colluded to misuse the stock exchange mechanism to profitably exit from their positions in the RTS scrip on February 11, 2009," Sebi whole-time member KM Abraham said in his order.

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