India's Securities and Exchange Board (SEBI) has barred Pradeep Pandya, a former television anchor, and seven other entities from the securities market for five years.
The regulator has also imposed a collective fine of Rs 2.6 crore for their involvement in fraudulent trading activities.
Pandya, who hosted stock market shows on CNBC Awaaz until August 2021, and Alpesh Furiya, a frequent guest and stock recommendation provider on the channel, were found to have engaged in coordinated trading activities.
According to SEBI’s 55-page order, there was a high correlation between stock recommendations made by Pandya on his show "Pandya Ka Funda" and the trades executed by Furiya and associated entities from November 2019 to January 2021.
SEBI’s investigation revealed that Pandya shared confidential information about upcoming stock recommendations with Furiya.
Furiya then used this information to make trades through his own accounts and those of related entities, allowing him to profit before the recommendations were aired publicly.
Furiya also passed on tips to Opu Funikant Nag in exchange for a salary increase.
“This behaviour demonstrates a clear intent to leverage insider information and exploit information asymmetry for personal gain,” SEBI noted.
The National Stock Exchange initially flagged the suspicious trading activities in December 2020, prompting SEBI to conduct a further analysis between November 2020 and January 2021.
The regulator examined call records between Pandya and Furiya, confirming that Pandya had advanced access to stock recommendation information, which he communicated to Furiya and connected entities.
As a result, SEBI has prohibited Pandya, Furiya, and six other entities from accessing the securities market and engaging in any buying, selling, or dealing in securities, either directly or indirectly, for five years.
Additionally, SEBI has fined Pandya and Furiya Rs 1 crore each and levied Rs 10 lakh fines on each of the remaining six entities.
SEBI has also directed Furiya, related accounts, and Opu Funikant Nag to disgorge unlawful gains from their fraudulent trades. Furiya and related accounts accrued Rs 10.73 crore in unlawful gains, of which Rs 8.4 crore has already been impounded.
They are now required to return the remaining Rs 2.34 crore. Nag has been ordered to disgorge Rs 10.20 lakh in unlawful gains.
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