Market regulator SEBI has disposed of a case regarding alleged fraudulent options trading by Indiabulls Securities Ltd. on the National Stock Exchange.
There was nothing on record to show that Indiabulls Securities – now known as Indiabulls Ventures — had connived or colluded with the 11 clients in executing the 36 non-genuine transactions in the options segment, SEBI said in an order dated April 27.
The regulator said the allegation levelled against Indiabulls Securities that it has violated the provisions of PFUTP (Prohibition of Fraudulent and Unfair Trade Practices relating to Securities Market) Regulations and Stock Broker Regulations is unsustainable. Accordingly, the regulator disposed of the adjudication proceedings initiated against Indiabulls Securities through the show-cause notice dated March 31, 2008.
The regulator had conducted an investigation into the dealings in the futures and options segment of the NSE during the period from Feb. 1 to March 31, 2005.
The probe conducted by SEBI had alleged that certain fraudulent dealings were committed by Indiabulls Securities in connivance with its clients, resulting in the misuse of the options segment at NSE during the investigation period.
It was also alleged that Indiabulls Securities had failed to exercise skill and diligence in its conduct as a stockbroker while executing the transactions in the options segment on behalf of its clients.
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