SEBI v. Dilip Kumar Kanoria and others (front running of a proprietary client, 2025)

Judgment entered

✓ 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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In October 2025 a SEBI adjudicating officer found that a long-serving dealer for a proprietary client traded ahead of its orders through his own and relatives' accounts. The four noticees were penalised Rs 10 lakh jointly and severally.

The record

What was ordered

Civil penalty

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Disgorgement

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Prejudgment interest

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Total relief

—

Alleged gain

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Penalty as published

1m 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

The adjudicating officer, Amit Kapoor, issued this order on 27 October 2025. The noticees are Dilip Kumar Kanoria, his wife Seema, Sakshi Kanoria and his Hindu undivided family account. He had acted as dealer, through KNA Share Brokers, for a proprietary big client, Shreekant Phumbhra.

SEBI examined trading in 2021 and alleged that the dealer, who knew the client's coming orders, bought or sold first in the same scrips through his own account and the other three accounts, then reversed the positions after the client's orders. The order counts 45 instances (34 buy-buy-sell and 11 sell-sell-buy patterns), with profit of Rs 2,85,462, of which Rs 1,70,091 came from derivatives and Rs 1,15,371 from cash equities.

The noticees filed a settlement application, which SEBI rejected in August 2025, and the hearing then went ahead. The order rejects their defences and finds violations of section 12A(a), (b) and (c) of the SEBI Act and Regulations 3 and 4 of the PFUTP Regulations, stating that the conduct exploited price movement caused by the client's large orders.

For the penalty under section 15HA, the officer noted that investor losses were not quantified and the conduct was not repeated. The four noticees must pay Rs 10,00,000 jointly and severally within 45 days, with recovery under section 28A if they do not.

The record does not show whether the noticees appealed, whether the penalty was paid, or whether a criminal case exists. No market ban was imposed in this order.

This library tags the matter as front running. 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 one technique 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.

• Front running — see how it works, what statute it engages, and every other action tagged the same way.

Timeline

1. 2025-10-27 SEBI adjudication order

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.