Settlement done between parties by exercising the power conferred under 15JB of SEBI ACT,1992 – the securities and exchange board of India
Settlement done between parties by exercising the power conferred under 15JB of SEBI ACT,1992 – the securities and exchange board of India Applications were filed for separate settlement in terms of the SEBI (Settlement Proceedings) Regulations, 2018 for the settlement without admitting or denying the findings of fact and conclusions of law, through a settlement order, the pending enforcement proceedings initiated against the applicants for the alleged violation of Section 12A(a), (b) &amp; (c) of the SEBI Act, 1992 read with Regulation 3(a), (b), (c),(d), 4(1) and 4(2)(q) of the SEBI (Prohibition of Fraudulent and Unfair Trade Practices Relating to Securities Market) Regulations, 2003. In the notice to show cause Mr.Akash Singhania, the fund manager of Deutsche Mutual Fund (hereinafter referred to as ‘DMF’), is alleged to have known investment and impending orders of DMF and based on the same, is alleged to have had opened four trading accounts for front running, through his parents and it is alleged that they have access to those trading accounts and were trading ahead of the orders of DMF and thus acted in concert to front-run the trades of DMF and earned a profit of ₹1,42,21,775/- According to the receipt of the applications, the authorized representatives of the applicants had a meeting with the Internal Committee of SEBI, and terms of the settlement were discussed and the High Powered Advisory Committee considered the settlement terms proposed by the applicants and recommended the case for settlement upon payment of ₹2,35,72,592and settlement amount along with a disgorgement of ₹1,42,21,775 wrongful gains with interest thereupon at the rate of 12% per annum amounting to ₹1,21,00,588. The exercise of the powers conferred under Section 15JB of the Securities and Exchange Board of India Act, 1992 and in terms of Regulations 23 read with Regulation 28 of the Settlement Regulations and conditions were mentioned for applicants by the authority. Click here to read the order
BEFORE THE SECURITIES AND EXCHANGE BOARD OF INDIA SO EFD 2 SD 394 DEC 2021 SETTLEMENT ORDER in Settlement Applications bearing Nos. 1. 6478 2021 Mr. Akash Singhania2. 6547 2021 Mr. Ashok Kumar Singhania3. 6548 2021 Ms. Premlata Singhaniain the matter of Deutsche Mutual Fund 1. Mr. Akash Singhania Mr. Ashok Kumar Singhania and Ms. Premlata Singhania filed separate settlement applications in terms of the SEBI Regulations 2018proposing to settle without admitting or denying the findings of fact and conclusions of law through a settlement order the pending enforcement proceedings initiated against the applicants for the alleged violation of Section 12A(a) &of the SEBI Act 1992 read with Regulation 3(a) b) (d) 4(1) and 4(2)(q) of the SEBI Regulations 2003 hereinafter referred to as “PFUTP Regulations”) vide Show Cause Notice bearing no. SEBI HO IVD ID17 P OW 2021 10538 1 dated May 20 2021. 2. In terms of the Notice to Show Cause served upon the applicants Mr. Akash Singhania the fund manager of Deutsche Mutual Fundis alleged to have had knowledge of investment and impending orders of DMF and on the basis of the same is alleged to have had opened four trading accounts for the purpose of front running through Settlement Order in respect of Mr. Akash Singhania and 2 others in the matter of Deutsche Mutual Fund. his parents Mr. Ashok Kumar Singhania and Ms. Premlata Singhania. It is alleged that Mr. Ashok Kumar Singhania and Ms. Premlata Singhania had access to the aforesaid trading accounts and were trading ahead of the orders of DMF and thus acted in concert to front run the trades of DMF and earned a profit of ₹1 42 21 775 in its meeting held on November 09 2021 considered the settlement terms proposed by the applicants and recommended the case for settlement upon payment of ₹2 35 72 592 as settlement amount along with disgorgement of ₹1 42 21 775 as wrongful gains with interest thereupon at the rate of 12% per annum amounting to ₹1 21 00 588 on joint and several liability basis. The aforesaid amounts were remitted by the applicants on December 13 2021. The credit of the above payments to SEBI is 5. In view of the above in exercise of the powers conferred under Section 15JB of the Securities and Exchange Board of India Act 1992 and in terms of Regulations 23 read with Regulation 28 of the Settlement Regulations it Settlement Order in respect of Mr. Akash Singhania and 2 others in the matter of Deutsche Mutual Fund. is hereby ordered that the pending enforcement proceedings for the alleged default as mentioned in paragraph 1 above are settled qua the applicants as per the following terms: i. SEBI shall not initiate enforcement action against the applicants for the said default this order disposes of the enforcement proceedings initiated by SEBI for the default as mentioned earlier in respect of the applicants and iii. passing of this Order is without prejudice to the right of SEBI under regulation 28 of the Settlement Regulations to take enforcement actions including continuing proceedings against the applicants if SEBI finds that: a. any representation made by the applicants in the present settlement proceedings is subsequently found to be untrue b. the applicants have breached any of the clauses conditions of undertakings waivers filed during the present settlement proceedings and c. there was a discrepancy while arriving at the settlement terms. 6. This settlement order is passed on this 22nd day of December 2021 and shall come into force with immediate effect. 7. In terms of Regulation 25 of the Settlement Regulations a copy of this order shall be sent to the applicants and also be published on the website of SEBI. sd S.K. MOHANTY ANANTA BARUA WHOLE TIME MEMBER WHOLE TIME MEMBER sd Settlement Order in respect of Mr. Akash Singhania and 2 others in the matter of Deutsche Mutual Fund. 