In­dia mar­ket reg­u­la­tor finds firm guilty of fraud­u­lent ac­tiv­ity

New Straits Times - - Business -

MUM­BAI com­pa­nies to re­turn gains of 4.47 bil­lion ru­pees (RM302.5 mil­lion) plus in­ter­est, ac­cord­ing to an or­der posted on its web­site on Fri­day.

“This is not a nor­mal case of price ma­nip­u­la­tion or vol­ume ma­nip­u­la­tion,” said SEBI’s whole time mem­ber G. Ma­halingam in the or­der.

This was a unique strat­egy of “ma­nip­u­lat­ing the set­tle­ment price in one mar­ket to gain across the vol­umes ac­cu­mu­lated in the other mar­ket”, he wrote.

Re­liance In­dus­tries said on Fri­day it would ap­peal the judg­ment as it be­lieved the trades in Re­liance Petroleum shares were gen­uine and car­ried out in the in­ter­est of its share­hold­ers.

“SEBI ap­pears to have mis­con­strued the true na­ture of the trans­ac­tions and im­posed un­jus­ti­fi­able sanc­tions,” said the com­pany.

SEBI or­dered Re­liance In­dus­tries to pay the stip­u­lated amount within 45 days with in­ter­est at 12 per cent a year start­ing in Novem­ber 2007. The to­tal in­clud­ing in­ter­est is al­most 10 bil­lion ru­pees, ac­cord­ing to cal­cu­la­tions.

Ac­cord­ing to the or­der, Re­liance’s board ap­proved the sale of five per cent of its stake in Re­liance Petroleum in March 2007 in or­der to raise funds.

In Novem­ber, Re­liance col­luded with 12 small com­pa­nies to take “sub­stan­tial po­si­tions” in that month’s fu­tures con­tract of Re­liance Petroleum, said the reg­u­la­tor. Re­liance had signed agree­ments with each of th­ese en­ti­ties and all the prof­its and losses were trans­ferred to its own ac­count, while they were paid a com­mis­sion, it added. Bloomberg


Re­liance In­dus­tries, along with 12 un­listed trad­ing houses it used, car­ried out un­law­ful trans­ac­tions in shares of its for­mer unit Re­liance Petroleum Ltd in late 2007.

Newspapers in English

Newspapers from Malaysia

© PressReader. All rights reserved.