SEBI’s Investigation Unveils Mystery ‘Big Client’ Linked to Ketan Parekh and Tiger Global
Exchange data reveals that Tiger Global emerged as the key player in a recent investigation by the Securities and Exchange Board of India (SEBI) involving former stockbroker Ketan Parekh. On November 11, 2022, Tiger Global sold approximately 12.7 million shares of PB Fintech, aligning with SEBI’s probe into an alleged front-running scheme orchestrated by Parekh through a Singapore consultant.
In its order, SEBI mentions a “Big Client,” a major foreign institutional investor, whose trades on that day were reportedly front-run by Parekh’s network. While Tiger Global was the largest institutional seller, there is no implication that the firm was aware of any wrongdoing.
According to SEBI, Rohit Salgaocar, the Singapore-based consultant, tipped off Parekh about an upcoming significant share sale, enabling traders with this insider information to profit by purchasing shares before the sale and selling them once the price dropped post-sale. The details leaked by Salgaocar included the planned sale of 1.75 million shares at 382 rupees, sparking a flurry of trades that saw PB Fintech shares surge to nearly 60 times their daily average volume.
Two of Tiger Global’s funds, Internet Fund III and Tiger Global Eight Holdings, executed large sales on that fateful day, while another Mumbai-based entity, Priyasha Meven Finance, also participated, albeit on a smaller scale.
However, it is essential to clarify that the SEBI order does not explicitly name Tiger Global in connection to the alleged scheme. Salgaocar’s role as an intermediary with referral agreements to major Indian brokerages apparently played a pivotal part in leaking sensitive, non-public information to Parekh, who in turn reportedly used this information to profit from the ensuing price movements.
While Tiger Global’s involvement in the events of that day is clear based on exchange data, it is crucial to note that there is no direct allegation or indication of the firm’s involvement in any wrongdoing in SEBI’s findings.
