24 June, 2021

Busting The Great Bourse Scam

Price rigging on the BSE has exceeded Rs 1,000 crore in the past year

Busting The Great Bourse Scam
It may not be the mother of all scams, but it surely is the mother-in-law of stock market scams for its sheer nagging persistence," says a Bombay-based financial analyst. Price rigging at the bourses is as old as ma-in-law's tongue; but this time it is being done with a subtlety and sophistication that has made a mockery of capital markets and its reforms.

With over 6,000 scrips listed on the Bombay Stock Exchange (BSE), it has become relatively easy for unscrupulous players to pick up a small capitalised company and rig the prices to make a fast buck. Says a sub-broker at the BSE involved in the scam: "For each such hick-town company, a sub-broker like me could easily make Rs 5 lakh to Rs 10 lakh in two months." 

According to financial analysts, the total amount of these manipulations would far exceed Rs 1,000 crore over the past year. Realising the scale of the problem, the Securities and Exchanges Board of India (SEBI), has launched a multi-pronged action programme to trap price manipulations in over 45 scrips. Last month, SEBI directed the BSE to holdback the...

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