SEBI Exposes Front-Running Scandal with Ketan Parekh and Tiger Global Trades
SEBI Exposes Front-Running Scandal Involving Ketan Parekh, Tiger Global Trades in PB Fintech
SEBI, the Securities and Exchange Board of India, has uncovered a front-running scam involving market veteran Ketan Parekh, trader Rohit Salgaocar, and others. This scandal revolves around trades related to Tiger Global’s sale of PB Fintech shares, the parent company of Policy Bazaar.
The investigation conducted by SEBI unveiled that Parekh and his group used non-public information about Tiger Global’s planned trades to make illegal profits. They allegedly communicated through WhatsApp to coordinate their actions. Included in SEBI’s 188-page order are screenshots of chats where Parekh gives instructions on trading strategies for PB Fintech shares.
Tiger Global sold 52.5 lakh shares of PB Fintech through two of its funds. SEBI’s findings indicate that GRD Securities, Salasar Stock Broking, and Anirudh Damani matched trades for 20.61 lakh shares with Tiger Global’s transactions.
Further scrutiny showed that Tiger Global entities, Tiger Global Eight Holdings and Internet Fund III Pte Ltd, sold a total of 1.23 crore shares of PB Fintech in 2022, with 32.84 lakh shares sold on the NSE at Rs 388.34 per share.
The timeline of events outlined in the order exposes how Salgaocar passed sensitive information from Tiger Global to Parekh through WhatsApp groups. On the morning of November 11, Salgaocar received details about the planned sale of PB Fintech shares from Tiger Global’s trader and immediately shared this with Parekh, who then instructed his associates before the market opened.
SEBI referred to Tiger Global as the “Big Client” in its order, refraining from naming the specific fund initially. The regulatory body emphasized the illegal nature of front-running, a practice where traders exploit confidential information to manipulate stock prices and gain unfair profits.
SEBI has taken action by impounding Rs 65.77 crore in connection with the scam, demonstrating its commitment to upholding market integrity. This case highlights SEBI’s dedication to combating unethical trading practices and ensuring transparency and fairness in the market.
