Sebi exiles Ketan for 14 years

The Securities and Exchange Board of India (Sebi) has barred Ketan Parekh and his associates from dealing in the securities market for 14 years.

Parekh might move the Securities Appellate Tribunal against the order, sources close to him said. Parekh, however, was not available for comment.

Sebi's order, issued yesterday, also covers Kartik K Parekh, Classic Credit Ltd, Panther Fincap and Management Services Ltd, Luminant Investment Ltd, Chitrakut Computers Pvt Ltd, Saimangal Investrade Ltd, Classic Infin and Panther Investrade Ltd.

Sebi said this order would not preclude the regulator from taking any other action against the entities included in this order.

The move followed the findings of the investigation into the excessive volatility in the stock market during February and March 2001, Sebi said in a statement. The order was passed after the affected parties were given a hearing by Sebi Chairman G N Bajpai.

In the order, the Sebi chairman has said the entities connected to and controlled by Ketan Parekh "if allowed to continue with their operations in the securities market, could pose a threat to the integrity of the securities market and endanger investors' interests".

Sebi's investigations found that two of the registered intermediaries, N H Securities and Classic Shares & Stock Broker Ltd, indulged in manipulative transactions in proprietary trading. There are other violations noted against these intermediaries, and proceedings are under way.

Sebi's investigations found that Parekh and associated entities had indulged in manipulation of the prices of a large number of scrips, especially Ranbaxy Labs, Aftek Infosys, SSI Ltd, Silverline Inds, Lupin Labs, HFCL and Digital GlobalSoft.

The order said Parekh's activities violated regulations of fair play in the market.

"In the instant case, Ketan Parekh, Kartik Parekh and all Ketan Parekh entities had indulged in activities that created false and misleading appearances of trading in the securities market."