LIC Front-Running Case: SEBI Bans Five Entities These entities have also reportedly been asked to 'cease and desist' from engaging in any fraudulent, manipulative or unfair trade practice, including front-running
By Teena Jose
Opinions expressed by Entrepreneur contributors are their own.
You're reading Entrepreneur India, an international franchise of Entrepreneur Media.
The Securities and Exchange Board of India (SEBI), on Thursday, has barred five entities including an employee of Life Insurance Corporation (LIC), from the securities market and impounded illegal gains of INR 2.44 crore made by them, in a case pertaining to front-running the trades of the state-owned insurer, according to a PTI report.
These five entities prohibited by Sebi are -- Yogesh Garg, who was working in the investment department of LIC through which trades on behalf of the insurer were placed; his mother Sarita Garg; his mother-in-law Kamlesh Agarwal; Ved Prakash HUF and Sarita Garg HUF, the capital markets regulator said in its interim order.
These entities have also reportedly been asked to 'cease and desist' from engaging in any fraudulent, manipulative or unfair trade practice, including front-running.
According to the market regulator's order, Yogesh Garg is still professionally associated with LIC. Sebi has been informed by LIC that Yogesh Garg has been transferred from the investment department of the company to another department of the insurance firm. The five entities are connected through family relations, common address and common phone number.
"It is prima facie concluded that Notices 1 to 5 (five entities) were involved in a scheme to front-run the trades of the Big Client (LIC) and therefore they are prima facie jointly and severally liable for the proceeds generated from the front-running trades," Sebi said.
These entities are alleged to have made illegal gains by way of the prima facie front-running activity amounting to INR 244.09 lakh, as per the news report.
