The Securities and Exchange Board of India (SEBI) has Prohibited a television anchor Hemant Ghai, his wife and his mother from accessing the capital markets for being indulged in fraudulent trading activity.
All three of them are alleged of gaining around 3crore between the period of January 2019 to May 2020. They were dealing in stocks recommended on a TV show 20:20 of leading business news channel, CNBC Awaaz.
Madhabi Puri Buch, the whole time member at SEBI told that “It was observed that Jaya Hemant Ghai (wife) and Shyam Mohini Ghai (mother) have undertaken a large number of Buy-Today-Sell-Tomorrow (BTST) trades during the relevant period in synchronization with the recommendations made in the Show. Shares were bought on the previous day to the recommendations being made on the stock 20-20 show and sold immediately on the recommendation day”.
She also said that the method applied by Ghai was to execute trading while taking benefits of Unpublished information which he had.
SEBI in its order have issued strict actions against Ghai tThe regulator has issued stern strictures against Ghai to safeguard the integrity of the market.
The strict actions issued include freezing of all bank accounts of all the three accused and an imprisonment on deposing off any of the assets. And also a detailed amount of Rs.2.95crore to remain confiscated until the full investigation is completed in the fraud.
The regulator reviewed the call data with brokers and dealers to confirm that Hemant Ghai was in control of the trading accounts of his wife and mother.
SEBI in its advisories have asked Ghai to stop giving his advices on investment. It has also asked the news channels to inform the viewers of the show hosted by Hemant Ghai about the prima facie violations of Sebi Prohibition of Fraudulent and Unfair Trade Practices (FUTP) Regulations.
SEBI has reviewed the stocks that were recommended on the show and the major impacts on their prices and volumes.
Following the fraud and full investigation SEBI has said, “Since the conduct of the aforementioned entities, prima facie appears to be unfair and not in the interest of investors and the securities market, necessary action has to be taken against them immediately, else it may lead to loss of investors’ trust in the securities market…It also has the effect of interfering with the development of the securities market, as investors tend to lose faith in the securities market Sin the face of such behaviour particularly by persons with large following. Hemant Ghai has approximately 1,16,000 followers on Twitter on the back of his popularity”.
