Description

SEBI adjudication order against Nishaa Anand for non-genuine reversal trades in illiquid stock options on BSE creating artificial volume during April 2014 to September 2015.

Summary

SEBI issued Adjudication Order No. Order/JS/VC/2025-26/31953 against Nishaa Anand (PAN: AJWPA4527H) for alleged violations related to non-genuine reversal trades in illiquid stock options on BSE during April 1, 2014 to September 30, 2015. The investigation revealed that 81.41% of all trades (2,91,744 trades) in BSE’s stock options segment involved reversal of buy and sell positions lacking trading rationale, creating artificial volume and false appearance of trading. Nishaa Anand was one of 14,720 entities found to have executed such non-genuine trades.

Key Points

  • SEBI conducted investigation into trading activities in illiquid stock options on BSE for the period April 1, 2014 to September 30, 2015
  • 2,91,744 trades comprising 81.41% of all trades in stock options segment were reversal trades
  • Reversal trades involved entities reversing their buy/sell positions with the same counterparty
  • 14,720 entities were found to have executed non-genuine trades during the investigation period
  • Nishaa Anand was identified as one of the entities indulging in reversal trades
  • Show Cause Notice dated October 27, 2021 was issued to the Noticee
  • Adjudicating Officer was appointed on April 03, 2025 following transfer from erstwhile AO

Regulatory Violations

The Noticee was charged with violations of:

  • Regulation 3(a), (b), (c), (d) of SEBI (Prohibition of Fraudulent and Unfair Trade Practices) Regulations, 2003
  • Regulation 4(1) and 4(2)(a) of PFUTP Regulations

The trades were alleged to be:

  • Non-genuine in nature
  • Deceptive and manipulative
  • Creating false or misleading appearance of trading
  • Generating artificial volumes in stock options contracts

Compliance Requirements

This is an enforcement action against an individual entity. Market participants should note that:

  • Reversal trades lacking genuine trading rationale may be scrutinized as manipulative
  • Creating artificial volume through non-genuine trades violates PFUTP Regulations
  • Trading activities in illiquid stock options are subject to regulatory oversight

Important Dates

  • Investigation Period: April 1, 2014 to September 30, 2015
  • Show Cause Notice issued: October 27, 2021
  • Adjudicating Officer appointed: April 03, 2025
  • Order published: January 2026

Impact Assessment

This adjudication order targets historical violations by an individual entity in the illiquid stock options segment. The investigation uncovered widespread non-genuine trading practices affecting BSE’s stock options market during 2014-2015. While this specific order has limited immediate market impact, it demonstrates SEBI’s continued enforcement against market manipulation and artificial volume creation. The order serves as a precedent for similar cases involving reversal trades and reinforces regulatory scrutiny of trading patterns in illiquid derivatives segments.

Impact Justification

Individual adjudication order for historical violations (2014-2015) involving non-genuine trades in illiquid stock options. Limited market-wide impact as it pertains to a single entity's past conduct.