(Image source from: })

Securities and Exchange Board of India (SEBI) has ordered impounding of unlawful gains worth nearly Rs 15 crore from the brokerage firm Sharekhan and 15 other entities. Front running is an illegal practice in the stock market where an entity trades on the basis of advance information from a broker or analyst before the information has been made available to their clients.

This refers to the 'front running' in at least 29 shares, including Idea Celluar, Suzlon Energy, Jet Airways, DLF, Cairn India, ICICI Bank, RCOM, Indian Hotels, HDFC Ltd, L&T, Unitech, Yes Bank, Videocon, JSW Steel and Hindalco.

SEBI directed impounding of the illegal gains of Rs 50.93 lakh from the Sharekhan, while an amount totalling to over Rs 14 crore, which would be impounded from 15 other entities including individuals and companies.

"As the alleged gains were made during the period March 2009 - March 2011, it becomes reasonable and necessary to levy an interest at 12 per cent simple interest per annum from the date on which such profits were earned," SEBI’s order noted.

"Therefore, Sharekhan’s bank and demat accounts are not ordered to be frozen for debits immediately, subject to it depositing the amount to be impounded ie Rs 50,93,894," the order said.

By Premji