Copthall Mauritius Investment, a unit of JPMorgan, and Mansi Share and Stock Broking have been allowed to resume trading in the broader securities market after depositing ₹3.68 crore in alleged wrongful gains in the closing auction session (CAS) manipulation case, a regulatory source said on Wednesday.
Copthall deposited ₹2.96 crore and Mansi ₹71.65 lakh within a day of the markets regulator directing the alleged illegal gains to be impounded in its August 19 ex-parte interim order.
A similar approach was adopted by the Securities and Exchange Board of India (SEBI) in the case of Jane Street, where market access was restored after the alleged wrongful gains were impounded.
While broader-market restrictions were lifted on August 20, both entities continue to be barred from participating, directly or indirectly, in the CAS in the equity segment until further orders.
SEBI’s action against Copthall and Mansi followed its examination of trading activity during the CAS on August 13, the weekly expiry of Sensex derivatives. The regulator had alleged that aggressive orders placed by the two entities in CAS to benefit from their respective derivatives positions caused sharp movements in the indicative equilibrium price of Sensex constituents during the auction.
The CAS was introduced on August 3 for stocks with derivatives contracts, with regular trading ending at 3.15 pm and the auction determining the closing price between 3.15 pm and 3.30 pm.