Two individuals settle insider trading case with sebi; pays Rs 74.87 lakh

PTI, 13th Jun 2022

New Delhi, Two individuals have settled with market regulator Sebi in case pertaining to alleged insider trading in the shares of Religare Enterprises Limited (REL) after paying a settlement amount totalling to Rs 74.87 lakh.

Individually, Vijaykumar Omprakash Jain paid Rs 22.31 lakh as settlement charges, while Sharda Jain remitted Rs 52.56 lakh which included Rs 26.66 lakh as settlement amount, Rs 17.92 lakh as disgorgement and Rs 7.96 lakh as interest, Sebi said in an order passed on Friday.

The order came after both the individuals approached the market regulator to settle the alleged violation "without admitting or denying the findings" through a settlement order.

"The pending enforcement proceedings for the alleged defaults... are settled qua the applicants," the market watchdog said in a settlement order, adding that it will not initiate any other enforcement action against them for the default.

Sebi had conducted an investigation in the matter to ascertain whether certain entities have traded in the scrip of REL during the period of October, 2017 to May, 2018 on the basis of Unpublished Price Sensitive Information (UPSI).

Based on the findings of the probe, enforcement proceedings were initiated against the entities through a show cause notice issued in July, 2021 for the alleged violation of insider trading rules.

As per the show-cause notice, Vijaykumar Jain is spouse to Sharda Jain and it is from their marriage that he also takes decisions related to his wife's investments.

In the show-cause notice, it was alleged that Ashok Mehta had shared various information for the purpose of investment in REL with Vijaykumar Jain.

Also, it was alleged that Mehta was as an independent director of REL and had access to certain UPSI, which included the information that Malvinder Singh and Shivinder Singh would be stepping down from the board of directors of REL.

Further, Vijaykumar was alleged to have communicated UPSI to his wife and also traded on behalf of her in the scrip of REL while in possession of the UPSI. Further, it was alleged that Sharda had indirectly traded in the scrip of REL, while in possession of UPSI, while Vijaykumar Jain allegedly placed the order on behalf of her and accordingly, they allegedly flouted the insider trading rules.