Indiabulls Ventures CEO, 4 others pay Rs 5 cr to settle insider trading case

New Delhi: Four individuals and one entity, including CEO of Ltd, paid around Rs 5 crore as settlement charges to market regulator Sebi to settle a case of alleged insider trading in shares of the firm. According to a Sebi order passed on Wednesday, the entities had filed separate settlement applications in terms of the SEBI (Settlement Proceedings) Regulations, 2018 proposing to settle the pending enforcement proceedings without admitting to or denying the findings of fact and conclusions of law through a settlement order.

The applicants were Divyesh B Shah, who was chief executive officer and whole time director, his relatives Dravinaben L Desai, Vikram L Desai, and Sharwary V Desai, and Vikram L Desai HUF.

The high powered advisory committee considered the settlement terms proposed by the applicants and recommended the case for settlement on payment of their respective settlement charges, the Sebi order said.

Divyesh was alleged to be in possession of unpublished price sensitive information (UPSI) pertaining to financial results of Indiabulls Ventures.

The firm on April 23, 2018, informed NSE and BSE regarding its audited standalone and consolidated financial results for the quarter and financial year ended on March 31, 2018. It had also declared an interim dividend. The period of UPSI was from April 2, 2018 to April 23, 2018.

Divyesh allegedly communicated the UPSI to his relatives who traded in the scrip of Indiabulls Ventures during the UPSI period. Vikram also traded on behalf of Dravinaben, Sharwary and Vikram Desai HUF.

By trading in the scrip of the company during the UPSI period, Dravinaben was alleged to have made unlawful gains of Rs 1.22 crore.

Pending the proceedings, they filed separate settlement applications with Sebi proposing to settle the case without admitting or denying the guilt.

Divyesh Shah has paid Rs 74.58 lakh as settlement amount while Vikram L Desai, Sharwary V Desai and Vikram L Desai HUF have paid Rs 22.31 lakh each.

Besides, Dravinaben L Desai has paid Rs 3.56 crore. This includes settlement charges, disgorgement of wrongful gains along with interest.