Sebi completes probe into RIL unfair trade practices case

The Securities and Exchange Board of India (Sebi) has completed its investigation into the eight-year-old case of Reliance Industries’ (RIL) fraudulent and unfair trade practices (FTUP), sources said.

“The investigation has been completed. RIL counsel would be awarded a final hearing in the coming weeks before any conclusion is reached,” said a source.

An email query to RIL did not elicit a response. The case pertains to allegations of the company violating the fraudulent and unfair trade practices norms in its dealings on the shares of one of its arm Reliance Petroleum in 2007.

RIL had applied for a consent mechanism, which would have allowed the company to settle charges without admission or denial of guilt. However, the regulator rejected the consent application. RIL then filed an appeal before the Securities Appellate Tribunal (SAT) challenging the Sebi order.

The SAT order said Sebi investigations have proved that RIL, in connivance with other entities related/connected to it, took short positions in the futures and options segments of the National Stock Exchange in the Reliance Petroleum scrip and sold around 200 million shares, thereby making an illegal gain of Rs 513.12 crore.

SAT Presiding Officer J P Devadhar said the dispute was rejected as it was not “consentable and maintainable”. Sebi had tweaked its consent norms in 2012 and made them stricter. However, it excluded serious offences, such as insider trading, from the settlement process.

Securities and Exchange Board of India ( SEBI )

Reliance Industries Limited (RIL)