SEBI v. 10,980 settling entities (reversal trades in illiquid BSE stock options, settlement scheme, 2023)

Settled

✓ Checked against the primary document on October 8, 2026. The library's summary, tags and figures for this record were compared with the regulator's own document by an AI model (Claude) following written instructions, in a single reading of the order; an independent second reading of 60 SEBI records agreed on every field for 56, the four misses being penalty amounts; a later sample of 50 of the SEBI records added on 9 October agreed on every field for 46. No lawyer has reviewed them. A checked record can still contain errors, and checked does not mean endorsed. See how we check records or report a correction.

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A March 2023 SEBI settlement order closed pending cases against 10,980 entities accused of creating artificial volume through reversal trades in illiquid BSE stock options between 2014 and 2015. Summing the annexure gives about Rs 118.8 crore in settlement amounts, paid without admitting or denying the allegations.

The record

What was ordered

Civil penalty

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Disgorgement

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Prejudgment interest

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Total relief

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Alleged gain

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Penalty as published

1.2bn INR

A dash means the release did not state a figure we could extract, not that the figure is zero. Penalty and disgorgement are stored separately so aggregates across the library do not double-count the same dollars. This regulator states penalties in INR. The figure is recorded as published and is not converted, so it does not appear in the USD totals or medians used elsewhere on this site.

What is alleged to have happened

SEBI's surveillance flagged a set of entities trading in illiquid stock options on the BSE whose trades consistently produced large losses and were then reversed with the same counterparties on the same or the next day. A review of the BSE stock options segment from 1 April 2014 to 30 September 2015 found that 14,720 of 21,652 trading entities had generated artificial volume by non-genuine or reversal trades, which SEBI said breached Regulations 3(a) to (d), 4(1) and 4(2)(a) of the fraud-on-the-market rules. It began adjudication proceedings against them. Other records in this library cover the individual adjudication orders in the same wider matter.

When many penalised entities appealed to the Securities Appellate Tribunal, the Tribunal suggested in May 2022 that SEBI offer a one-time settlement scheme for this class of cases. SEBI announced the SEBI Settlement Scheme, 2022 in August 2022, kept it open from 22 August 2022 and extended it to 21 January 2023. Applicants paid a specified settlement amount and a registration amount through an online platform.

The order of 8 March 2023, signed by two whole-time members, records that 10,980 entities took up the scheme. It settles the pending proceedings against all of them on the terms that SEBI will not start any other action for those defaults and will not continue the existing proceedings. It reserves SEBI's right to resume action against any applicant whose representations prove untrue or who breaches the undertakings or waivers it filed. Annexure A lists each applicant with the amount paid, most Rs 1 lakh or Rs 2 lakh, with a few larger sums.

The order does not state a total. Adding the amounts in the annexure gives roughly Rs 118.84 crore, a figure that is our own sum and not one the regulator states. Settlement orders involve no finding of violation and the applicants neither admitted nor denied the allegations.

The record does not show the individual conduct of any applicant, what trades each settled, or what happened to the remaining 3,740 or so entities from the original group of 14,720. It describes no criminal case.

This library tags the matter as matched orders and wash trading. The tagging is ours, not the regulator's.

For the regulator's own account of the facts, read the primary document linked above. This page deliberately summarises the structured record rather than reproducing the order.

What technique is this, and how does it work?

This action is tagged with 2 techniques in our taxonomy. The tagging is ours: regulators charge statutory provisions, not technique names, so the mapping is an editorial judgement described in our editorial policy.

• Matched orders — see how it works, what statute it engages, and every other action tagged the same way.
• Wash trading — see how it works, what statute it engages, and every other action tagged the same way.

Timeline

1. 2023-03-08 SEBI settlement order under the 2022 settlement scheme

Primary documents

Everything on this page derives from the documents below. Where our summary and the primary document disagree, the primary document is right.

• SEBI order

The linked release is published by the issuing regulator under its own terms. Our summary and narrative above are our own writing.

Related actions

Other actions in the library sharing at least one technique tag with this one.

Record added October 8, 2026. submit a correction.