Vani Commercial Ltd involved in huge scandal of fraudulent trade practices. Markets regulator SEBI has imposed a total fine of Rs 70 lakh on 14 individuals for indulging in fraud trading activities in the shares of Vani Commercial Ltd more than four years ago.
The 14 individuals carried circular. It synchronized trades among themselves in the company’s shares. They created artificial volumes. The main company officials involved in the scandal.
Since fraud increased day by day. The fraudulent trade practices raised. The regulator carried out an investigation into the scrip of Vani Commercial Ltd for the May 26, 2017 to October 30, 2017 period.
While imposing a fine of Rs 5 lakh each on the individuals, SEBI said these individuals “through their trading sustained artificial volume and price in the scrip for a period of time after which the price fell”.
According to the watchdog, the individuals were connected to each other, and had executed circular and synchronized trades among themselves which contributed to more than 40 per cent of the total trading volume during the investigation period resulting from the circular trades.
The noticees (Individuals) executed total 299 circular trades. It led to no ultimate change in beneficial ownership.
Generally seller and buyer understand synchronized pr circular trading that trade on specific shares. The shares of the company are in the hands of the main company officials.
The noticees stopped the synchronized and circular trades. The trade volume dropped. Prices slowly moved downwards. The price on 27 July 2017 had fallen to Rs 42. As the trading volumes fell in August 2017, the price also fell to Rs 19 by end August 2020.
Final Words regarding Vani Commercial Ltd
The noticees manipulated the trade on the facts of record. It created artificial trading volumes and helped sustain the price levels in an artificial manner,” the order said.
SEBI is regarded as one of the important regulatory body. So SEBI imposed a penalty on on Vani Commercial Ltd. The fine imposed was Rs. 70 Lakhs on the 14 main company officials.
