SEBI Cracks Down On 15 Zee Business Guest Experts Over 'Unlawful Gains'

The market regulator in an interim order has asked several guest experts on Zee Business to repay Rs 7.41 crore in alleged unlawful gains made by taking positions contrary to their on-air advice.

The investigation focused on the correlation between trading activities and stock recommendations of the experts from Feb. 1, 2022 to Dec. 31, 2022, according to the interim order of the Securities and Exchange Board of India.

SEBI has identified three categories of individuals: profit makers (who gained from alleged insider information); enablers (aiding profit makers); and guest experts (providing non-public information).

SEBI has issued orders against 15 experts. Simi Bhaumik, Mudit Goyal, Himanshu Gupta, Ashish Kelkar, Kiran Jadhav, and others, have been categorised as guest experts, profit makers, and enablers. While some were directly involved in unlawful trades, others facilitated such activities. Several have been barred from trading until further notice, according to SEBI's Feb. 8 order.

The evidence collected for this order includes the identification of connections among the 15 noticees based on various materials and the examination of mobile phone details obtained during the search and seizure operation.

The evidence comprises:

(a) Demonstrating connections among the noticees, analysed from materials on record and mobile phone details.

(b) Providing evidence of sharing advance information about scrip/contract recommendations by guest experts with profit makers before their appearance on Zee Business.

(c) Presenting evidence of trades carried out by profit makers based on this advance information.

(d) Indicating evidence of increased trade volumes and favorable price movements aligned with recommendations, creating profit opportunities for Profit Makers.

(e) Showing evidence of Profit Makers sharing profits with guest experts.

SEBI's interim order outlines measures such as creating an interest-bearing Escrow Account, restricting transactions in bank and Demat accounts, and freezing securities transactions.

The noticees are prohibited from disposing of assets without SEBI's permission, and Zee Media Corp. is advised to preserve relevant records.

The directives serve as an interim order-cum-show-cause notice, calling upon the entities to justify why further actions, including disgorgement, market access prohibition, and refraining from research advisory activities, should not be imposed under relevant legal provisions.