MUMBAI, JANUARY 31: Securities and Exchange Board of India (Sebi) today suspended a member each of NSE and BSE for over 18 months for their involvement in price rigging in BPL, Videocon and Sterlite Industries scrips during June 1998. NSE member, Digital Leasing & Finance Ltd, has been suspended for three years till June 9, 2001, while BSE member Bharat J Patel has been suspended for 18 months till May 1, 2000, considering the date of suspension of these members by the respective exchanges, Sebi said in a statement here.These brokers, against whom inquiries were initiated and completed now, were earlier directed not to undertake any fresh broking activity till the enquiry proceedings were over, it said. Accordingly, trading terminals of DLFI was switched off by NSE since June 10, 1998 and the terminal of Bharat Patel was de-activated by BSE with effect from November 2, 1998, pursuant to Sebi orders, it added.
Sebi said after the inquiry it was found that these brokers were involved in manipulations in the scrips, and they dealt for common set of clients - Damayanti Group - for the first time, though the client did not have any professional expertise in securities market and financial soundness to deal in such a large scale, it said.
These brokers acting in concert with other brokers cornered a very large quantity of share of BPL, Videocon and Sterlite and created artificial market and manipulated their scrip prices, upsetting the equilibrium of the market, apart from indulging in many malpractices, it added.
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