Description

SEBI adjudication order imposing penalty on Anupama Agarwal for executing non-genuine reversal trades in Illiquid Stock Options on BSE during April 2014 to September 2015, violating PFUTP Regulations.

Summary

SEBI’s Adjudicating Officer issued an order (No. Order/JS/RJ/2025-26/32196) against Anupama Agarwal (PAN: AIGPA7456G) for participating in non-genuine reversal trades in the Illiquid Stock Options (ISO) segment of BSE during the investigation period of April 1, 2014 to September 30, 2015. The trades were found to be manipulative and deceptive, creating artificial trading volumes in violation of SEBI’s PFUTP Regulations.

Key Points

  • SEBI investigated large-scale reversal trades in BSE’s Illiquid Stock Options segment for the period April 1, 2014 to September 30, 2015
  • A total of 2,91,643 trades comprising 81.38% of all trades in BSE’s stock options segment were identified as reversal trades
  • 14,720 entities were found to have executed non-genuine trades; Anupama Agarwal was one of them
  • The Noticee’s trades involved reversing buy/sell positions with the same counterparty, lacking genuine trading rationale
  • These trades allegedly created a false or misleading appearance of trading activity and artificial volumes
  • Show Cause Notice was issued on March 31, 2022; the current AO was appointed via communiqué dated April 04, 2025

Regulatory Changes

No new regulatory changes introduced. This is an enforcement action under existing regulations:

  • Section 15-I and Section 15HA of the SEBI Act, 1992
  • Rule 5 and Rule 4(1) of SEBI (Procedure for Holding Inquiry and Imposing Penalties) Rules, 1995
  • Regulations 3(a), (b), (c), (d), 4(1) and 4(2)(a) of SEBI (Prohibition of Fraudulent and Unfair Trade Practices) Regulations, 2003

Compliance Requirements

  • Market participants must avoid executing reversal trades or any trades that create artificial volumes or a false appearance of trading activity
  • All trades must have genuine economic rationale and must not be coordinated with counterparties to reverse positions
  • Entities engaged in stock options trading must comply with PFUTP Regulations to avoid adjudication proceedings and penalties

Important Dates

  • April 1, 2014 – September 30, 2015: Investigation period for illiquid stock options trades on BSE
  • March 31, 2022: Show Cause Notice issued to the Noticee
  • April 4, 2025: Current Adjudicating Officer appointed
  • March 9, 2026: Date of this adjudication order

Impact Assessment

This order has limited broad market impact as it is an individual enforcement action against a single participant for historical violations. However, it reinforces SEBI’s ongoing enforcement stance against manipulation in illiquid derivatives segments. The case is part of a larger sweep involving 14,720 entities and underscores SEBI’s continued pursuit of ISO manipulation cases from the 2014-2015 period. Traders and brokers should note SEBI’s long enforcement reach—cases from over a decade ago continue to result in penalties.

Impact Justification

Individual enforcement action against a single retail participant for historical trading violations (2014-2015); no systemic regulatory change or broad market impact.