SEBI Bans JPMorgan Unit and Broker for Market Manipulation

The Securities and Exchange Board of India issued an interim order banning Copthall Mauritius Investment Ltd., a unit of JPMorgan Chase & Co., and Mansi Share and Stock Broking Ltd. from the capital market. The regulator alleged the firms executed manipulative trades during the closing auction window on August 13 to influence the BSE Sensex Index's indicative equilibrium price to benefit their options positions.

SEBI found that the entities placed orders near the upper price band and then canceled large portions of them to influence prices without full execution. The regulator will lift the ban once the firms return approximately 37 million rupees in unlawful gains. While the order targets the Mauritian entity, it does not directly impact the local Indian operations of JPMorgan Chase & Co.

The crackdown occurred within six days of the alleged activity, a timeline significantly faster than previous investigations. This enforcement follows the implementation of the Closing Auction System, a reform designed to align Indian markets with global standards. SEBI Chairman Tuhin Kanta Pandey stated that "the new system is here to stay."