SEBI adjudicating officer imposed a penalty of ₹10 lakh on Mr. Bhavik Shah, his wife, and his HUF for front-running trades of their employer, Kaushik Shah Shares & Securities.
The noticees executed 72 front-running instances in a Buy-Buy-Sell pattern, generating illicit profits of ₹5.14 lakh over a 3.5-year investigation period from October 2021 to January 2025.
Mr. Bhavik Shah, as a dealer for the 'Big Client,' was found to have misused his access to non-public information on impending substantial orders to trade ahead in related entity accounts.
The order found violations of SEBI Act Sections 12A(a), (b), (c) and PFUTP Regulations 3(a)-(d), 4(1), and 4(2)(q), rejecting defenses of independent research and de minimis gains.