Sebi cracks down on Rs 420-cr tax fraud and pump-and-dump stock manipulation, bars 178 entities

Sebi cracks down on Rs 420-cr tax fraud, bars 178 entities

After finding them guilty of manipulation in the stock market for making illegal gains, Sebi has restrained the 178 entities, including Pine Animation, from accessing the securities market.
8 May 2015

Press Trust of India

Mumbai, May 8 (PTI) In a fresh clampdown on misuse of stock market platform for suspected money laundering activity, Sebi today banned Pine Animation and 177 related entities from securities market for alleged tax evasion worth Rs 420 crore. The capital market watchdog in December last year had barred 260 entities, including individuals and companies, from the securities markets, for indulging in similar activities. The latest ban has been imposed on 178 entities, including Pine, its two promoters and eight directors. Noting that stock exchange system cannot be permitted to be used for any unlawful/forbidden activities, Sebi today said that “prima facie” certain market manipulations are taking place in the scrip of Pine.

“… it can safely be assumed that the entire modus operandi of allotting shares on a preferential basis, announcing a stock split and then bringing in connected entities to provide exit was a scheme devised to make ill-gotten gains,” the regulator said. Sebi also noted that the modus operandi of pumping up the share price artificially and then dumping the price so that the same cycle could be repeated, demonstrates the malafide intention of the Pine Group.

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