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Market regulator SEBI on Monday passed an interim order under the Prohibition of Fraudulent and Unfair Trade Practices (PFUTP) Act against an anchor of CNBC Awaaz and five connected entities.
SEBI found Alpesh Furiya and 4 connected entities were trading in shares ahead of recommendations made by Pradeep Pandya, the anchor of various shows on CNBC Awaaz. The regulator found links between Pandya and Furiya and a few other entities and barred them from dealing in stock markets or disposing of their assets till further orders. SEBI also directed impounding ₹8.4 crore worth proceeds from the fraudulent trades.
SEBI in its order said NSE had forwarded a report (December 10, 2020) wherein it had analysed the trading activity of Alpesh Vasanji Furiya and related entities and prima facie observed that there was a strong correlation of their trades with the recommendations provided by Pradeep Pandya on his show Pandya Ka Funda on CNBC Awaaz.
SEBI said that analysis of Call Data Records show that Pandya and Furiya were frequently in touch with each other throughout the relevant period that was under SEBI investigation, apart from being connected to each other on social media.
Pandya is uniquely placed to have access, in advance, to the information pertaining to the recommendations. Pandya, Furiya and connected entities are also aware that such recommendations, when telecast, lead to an increase in the traded volume and price of the scrip. Hence, the information related to the recommendation is material and non-public till the time it is telecast.
"The Network18 Group, of which CNBC Awaaz is a part, has a detailed code for dealing in securities by employees with access to price-sensitive information. The code forbids short-term trading and speculation. It mandates that such employees own securities for at least six months and lays down detailed guidelines for disclosure of holdings," said a statement from Network18.
"Pandya resigned from our organization in August. His actions, as detailed in the SEBI order, would constitute a clear violation of our code as well as Network18’s ethical standards. We will continue to provide all possible assistance to SEBI authorities," it added.
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