SEBI directed that the noticees be banned from trading in securities and associating with depositories, and to disgorge ₹11.37 crore jointly in addition to a penalty. File
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The Securities and Exchange Board of India (SEBI) has banned, among others, Sanjiv Bhasin, the Director of IIFL Securities, from securities trading for taking stock positions contrary to his public recommendations.

Experts said that Mr. Bhasin was the first high profile research analyst SEBI had penalised for front running. So far, the securities watchdog has pulled up other market participants for front running, but not a research analyst.

“He [Bhasin] used to first buy securities himself, then used to recommend the same securities to the public on news channels…and/or IIFL Telegram Channel, to buy the same securities. Once prices of securities increased after his recommendations, Sanjiv Bhasin used to sell the securities, thereby making a profit,” SEBI said in its findings in the investigation based on complaints received.

“Most of his recommendations were ‘buy.’ The stocks that Mr. Bhasin recommended were those of major companies like L&T Technology Services, Parag Milk Foods, Interglobe Aviation, Steel Authority of India Ltd., and Godrej RCP. The total amount gained by the unlawful trading of the recommended stocks amounted to ₹11.37 crore,” according to the findings.

The markets watchdog served notices to Mr. Bhasin, who was the guest speaker on media, the “enablers” Lalit Bhasin and Ashish Kapur, and their company RRB Holdings, and three others who were the “profit makers”, along with their companies involved.

SEBI directed that the noticees be banned from trading in securities and associating with depositories, and to disgorge ₹11.37 crore jointly in addition to a penalty. The regulator also directed that their banks should not allow payments without its permission. The noticees were given 21 days to respond to the interim order.