SEBI bans Ketan Parekh again for new front-running scam allegations

Parekh was behind one of the worst financial scandals in India's history at the turn of the century

Published on: Jan 3, 2025, 16:44:05 IST

By HT News Desk | Edited by Abhyjith K. Ashokan

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Market regulator Securities and Exchange Board of India (SEBI) has banned former stock broker Ketan Parekh from buying and selling securities again. This time, it is for allegedly front-running trades of a US-based fund, Bloomberg reported.

SEBI had investigated the trades undertaken by individuals and brokers associated with Parekh over a two-year period which ended on June 2023 (File Photo)

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Parekh was behind one of the worst financial scandals in India's history at the turn of the century.

SEBI had investigated the trades undertaken by individuals and brokers associated with Parekh over a two-year period which ended on June 2023, the order released by the regulator on Thursday, January 2, 2025, said.

The investigation showed that Parekh had allegedly obtained non-public information of a major US fund’s trades from Singapore-based Rohit Salgaocar, who had an agreement to refer trades of that fund to Motilal Oswal Financial Services Ltd. and Nuvama Wealth Management Ltd, according to the report.

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Parekh then passed on the information to his associates to front run the trades, SEBI member Kamlesh Varshney had said in the order.

SEBI had initially banned Parekh in 2003 for 14 years due to allegations of insider trading, price rigging and illegal diversion of bank funds into the stock market.

These actions resulted in a stock market crash in February and March 2001.

Varshney had also ordered the impounding of about ₹65.80 crore in “unlawful gains” made by these entities allegedly involved in the scam.

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Parekh and 21 others named in the SEBI order have also been given 21 days to respond to the findings.

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HT News Desk
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