New Delhi, Aug 19 (PTI) Capital markets regulator Sebi on Wednesday imposed a penalty of Rs 14.10 lakh on Balaji Infrasolutions Pvt Ltd for indulging in fraudulent trading in illiquid stock options segment on the BSE.

An investigation was conducted by the regulator for the period of April 1, 2014 to September 30, 2015 into the trading activities of certain entities in the illiquid stock options segment on the exchange.

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During that period, Sebi observed that a total 2,91,643 trades comprising substantial 81.38 per cent of all the trades executed in the stock options segment of the BSE were non-genuine trades.

Balaji Infrasolutions was one of the entities which had indulged in creating artificial volume of 63,25,000 units through 172 non-genuine trades in 80 stock option contracts, as per the regulator.

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According to the order, Sebi said this pattern of trades continued for 13 days.

Therefore, the trades executed by the noticee were non-genuine in nature and had created a misleading appearance of trading in illiquid stock option contracts, Sebi said.

Also, such trading pattern of the noticee, which was fraudulent and deceptive, affects the normal price discovery mechanism in the securities market, the regulator noted.

"People who indulge in manipulative, fraudulent and deceptive transaction, or abet the carrying out of such transaction which are fraudulent and deceptive should be suitably penalised for such acts of omissions and commissions," the watchdog said in its order.

Therefore, the regulator penalised Balaji Infrasolutions Pvt Ltd for violating the provisions of PFUTP (Prohibition of Fraudulent and Unfair Trade Practices) Regulations.

(The above story is verified and authored by Press Trust of India (PTI) staff. PTI, India’s premier news agency, employs more than 400 journalists and 500 stringers to cover almost every district and small town in India.. The views appearing in the above post do not reflect the opinions of LatestLY)