Sebi levies Rs 15 lakh penalty on Parsoli Corporation

Markets regulator Sebi today imposed a total fine of Rs 15 lakh on stock broker Parsoli Corporation for indulging manipulative trade practices in the shares of Dalal Street Investments Ltd (DSIL).
In an order, Sebi said the manipulative acts of Parsoli Corporation are attributable to the artificial increase in the volume and price in the scrip of DSIL on September 10 and 25, 2008 and that the stock broker failed to exercise due diligence while registering the client, monitoring the transactions and implementation of risk management practices.
According to the regulator, Parsoli Corporation violated PFUTP (Prohibition of Fraudulent and Unfair Trade Practices relating to Securities Market) Regulations and Sebi (Stock Brokers and Sub-brokers) Regulations.

The order of the Securities and Exchange Board of India (Sebi) has come following an investigation into the alleged irregularity in the dealings in the shares of DSIL during the period from September, 2008 to July, 2009.
The regulator noted that post the trades of the client (Nilesh Prajapati) on September 10 and 25, 2008, the price of the scrip of DSIL moved from Rs 4,438 apiece to Rs 10,817.70 in 45 trades with trading of just 82 shares.
"The conduct and dealings of the noticee (Parsoli Corporation) is highly irregular and indicative of the manipulative/ fraudulent intent to create to deliberately false and misleading volume and price in the market," Sebi said.

The regulator also said that Parsoli Corporation as a stock broker had "failed to identify the genuineness and financial soundness of the clients, which is required to be continuously monitored".