Sebi levies Rs 20 lakh fine on individual for insider trading in Videocon

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Markets regulator Sebi on Friday imposed a fine of Rs 20 lakh on an individual for violation of insider trading norms in the shares of Videocon Industries Ltd. Pradeep kumar Dhoot is an immediate relative of Venugopal Dhoot who was the chairman and managing director of Videocon during the relevant period.

Pradeep violated Prohibition of Insider Trading (PIT) norms. "Trading by any insider during UPSI period and during window closure period is itself against the legislative/regulatory framework set-up under SEBI PIT Regulations, 2015," Sebi said.

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The authorised representative– Pradeep kumar Dhoot– was the insider who traded on behalf of the promoter the company, CE India Ltd, during the UPSI period. Sebi carried out an investigation between April-September 2017 for the possibility of insider trading and volume manipulation in Videocon's scrip by certain entities.

During the investigation, it was observed that, during the UPSI period, some of the promoters of Videocon had transferred their shares to other entities through off-market transactions and subsequently some of these shares were offloaded in the market. Pradeep, being an insider, executed off-market transactions while in possession of unpublished price sensitive information (UPSI).

The information with respect to classification of Videocon's loan account as NPA by Dena Bank was likely to materially affect the price of Videocon Industries and it was considered as UPSI. The period of UPSI was March 1, 2017 to May 9, 2017. Consequently, Pradeep is facing a fine of Rs 20 lakh.