SEBI Bans 13 Traders for Front Running Trust Transactions

The Securities and Exchange Board of India (SEBI) has taken decisive action against 13 individuals involved in front running trades of three prominent trusts, marking a strong move to maintain integrity in the securities market.

Front running, a practice where traders buy or sell shares ahead of large pending orders to gain unfair profits, was at the heart of the investigation. The three trusts in focus were the Bharat Kanaiyalal Sheth Family Trust, the Ravi Kanaiyalal Sheth Family Trust, and the Arjun Discretionary Trust.

SEBI’s probe, covering the period from January 1, 2021, to October 31, 2022, revealed that the individuals executed trades just before the trusts’ transactions, thereby earning illegal gains. Penalties for the 13 traders have been set between ₹5 lakh and ₹15 lakh (approximately $5,688 to $17,066), reflecting the seriousness of the violations.

This action reinforces SEBI’s commitment to curbing unfair trading practices and ensuring a level playing field for all investors in the Indian securities market. Market participants are reminded that such manipulative strategies are closely monitored and dealt with strictly.