The Securities and Exchange Board of India (SEBI) has recently taken action against former CNBC Awaaz anchor Hemant Ghai, his wife Jaya Ghai, and others for violating securities laws. SEBI has imposed a fine of Rs 50 lakh on Hemant Ghai and an equal penalty on his wife for their involvement in fraudulent trading activities.
SEBI’s Ruling: A Five-Year Ban on Ghai Family
In addition to the monetary fines, SEBI has imposed a strict five-year ban on Hemant Ghai, his wife Jaya, and his mother, Shyam Mohini Ghai. During this period, they will not be allowed to participate in any securities market activities, including trading and investing.
The Violation: Insider Trading and Fraudulent Practices
SEBI’s investigation revealed that Hemant Ghai engaged in fraudulent trading practices. He traded stocks in his wife’s and mother’s accounts ahead of the stock recommendations he made on CNBC Awaaz. This took place over five years ago and was considered a clear violation of securities laws.
Penalty for MAS Consultancy Services and Motilal Oswal Financial Services
SEBI also levied penalties on MAS Consultancy Services and Motilal Oswal Financial Services for their involvement in the violation. MAS Consultancy Services, affiliated with Motilal Oswal, was found guilty of submitting fabricated order instruction sheets and failing to maintain proper records of trading instructions. These actions breached regulatory norms.
Order to Return Fraudulent Gains
As part of the ruling, Hemant Ghai and Jaya Ghai have been ordered to return the profits made from their fraudulent trading activities. The amount must be returned with a 12% annual interest rate, starting from March 31, 2020, until the date of the interim order.
Payment Deadline and Interest
The fines must be paid within 45 days into SEBI’s Investor Protection and Education Fund. If the amount is not paid within the deadline, it will accrue a 12% annual interest, adding to the financial burden.
