SEBI's Proposals To Deal With Unexplained Suspicious Trading Patterns To Help Curb Fraud; Boost Investors' Confidence: Experts

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Top Highlights

• the use of innovative, vanishing, and encrypted methods of private communication, as well as complex and untraceable funding arrangements in several cases, makes it impossible to establish the pre-ponderance of probability

• unexplained suspicious trading patterns

• mule accounts, complex entity structures, and encrypted communication

• person or group of connected persons exhibiting an unexplained suspicious trading pattern -- repetitive abnormal gainful dealings in a security or a set of securities, around the presence of material non-public information -- would be deemed to be violating the securities laws, unless they are able to effectively rebut the said presumption

• substantial change in risk taken

• delivered abnormal profits or averted abnormal losses

• With advancements in technology, new methods are being adopted by certain market participants to carry out fraudulent and unfair practices in markets