January 13, 2022 3:36:28 am
The Securities and Exchange Board of India (Sebi) has banned 6 persons from securities market till further orders for alleged involvement in using social media platforms like Telegram and Twitter to artificially influence stock prices and make illegal profits.
The six persons are Himanshu Mahendrabhai Patel, Raj Mahendrabhai Patel, Jaydev Zala, Mahendrabhai Bechardas Patel, Kokilaben Mahendrabhai Patel and Avaniben Kirankumar Patel. The regulator also impounded bank accounts of the six persons for an amount of Rs 2.84 crore.
“The modus operandi indicated that certain entities actively operating through social media channels are first taking a position (purchasing shares) in small cap companies in bulk quantities and then sending baseless and fraudulent messages indicating strong possibilities of immediate price hike in such scrips through such social media channels thereby instigating others to take bullish position in those scrips,” said a Sebi order. Ultimately after the prices go up, they take contrary positions (selling their previously acquired shares) thereby making profits out of such trades executed under such fraudulent scheme and device, Sebi said.
Their Telegram channel provided recommendation to its subscribers for trading in both cash as well as derivatives segments, for both intra-day as well as positional trades.
The recommendations issued with respect to the cash segment are majorly focused on small cap scrips, Sebi said.
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