SEBI finds 8 non-genuine reversal trades in 4 stock option contracts

It details the adjudication proceedings and the specific violations of SEBI regulations regarding fraudulent and unfair trade practices.

Who it concerns: Sonia Chadha (PAN: AACPC8962H); Bombay Stock Exchange (BSE) (as the venue of the trades); SEBI (as the regulator).

What SEBI found or ordered

• SEBI found that Sonia Chadha executed 8 non-genuine reversal trades in 4 stock option contracts.
• These trades resulted in the creation of artificial volume totaling 88,000 units.
• The alleged violations occurred between April 1, 2014, and September 30, 2015.
• SEBI alleged violations of Regulations 3(a), (b), (c), (d), 4(1), and 4(2)(a) of the PFUTP Regulations, 2003.
• The Noticee did not avail of the SEBI ISO Settlement Schemes of 2022 or 2024.
• The Noticee claimed inability to retrieve records from 2014-15 due to tax law retention limits, but SEBI noted she had previously confirmed receipt of the Show Cause Notice and annexures.

Also in the document

• SEBI noted that the Noticee's non-genuine trades constituted between 14.29% and 100% of the total trades in the specific contracts involved.
• The artificial volume generated by the Noticee contributed between 17.86% and 100% of the total market volume in those specific contracts.
• SEBI cited a Supreme Court judgment (SEBI Vs Bhavesh Pabari) regarding the exercise of power within a reasonable time when no specific limitation period is prescribed in the SEBI Act.