SEBI plans to take ‘Preventive’ Actions to curb frauds

India Infoline News Service | Mumbai | September 28, 2017 10:43 IST

SEBI to set a body to identify and penalize fraudsters who benefit by price rigging of stocks

The market has been suffering from incidents of price rigging, and Securities and Exchange Board of India (SEBI) being the regulatory body, has asked the intermediaries to identify its root cause. It has asked to find the factors involved in such malpractice and has requested the bodies to propose riders for curbing the same.

SEBI has proposed a preventive framework to curb manipulation of markets. It has asked the inputs of stock exchanges and depositories for the same. The mechanism is eyeing on money launderers who use the market instruments to transfer money via end-to-end beneficiaries.

“The regulator is undertaking a comprehensive review of its surveillance systems. It is working on several measures that would fill the gaps in existing regulations and would be preventive rather than reactionary,” stated an official in the regulatory body.

As directed by SEBI, the exchanges have formed sub-committees to mull these options.

“The exchanges are analyzing the past instances and the modus operandi adopted by the manipulators to plug the loopholes,” stated an exchange official.

To curb frauds, imposition of stringent penal action is under consideration.

Price rigging occurs when operators and promoters work in tandem to raise the stock prices of listed firms. This leads to spike in valuation so that the operators achieve short term gains via trading. With strict actions taken by SEBI, such malpractices are expected to be suppressed and penalized. 


  • Save upto Rs.2.67 lakh with Pradhan Mantri Awas Yojana ...Know more
  • Now Save Rs.3150 on your Demat Account ...Click here
  • Now get IIFL Personal Loan in just 8* hours...APPLY NOW!
  • Get the most detailed result analysis on the web - Real Fast!
  • Actionable & Award-Winning Research on 500 Listed Indian Companies.