SEBI Impounds ₹21.16 Crore in Front-Running Scheme Involving PNB MetLife Dealer

GG News Bureau
New Delhi, 22nd Dec. Markets regulator Sebi has uncovered a major front-running scheme involving Sachin Bakul Dagli, an equity dealer at PNB MetLife India Insurance, and eight other entities. The scheme, which ran for over three years, generated illegal profits of ₹21.16 crore.

In an interim order passed on Friday, Sebi prohibited Sachin Bakul Dagli and the eight entities involved from participating in the securities market. The regulator also impounded the unlawful gains made through this fraudulent activity. PNB MetLife stated that it fully cooperated with Sebi during the investigation and has taken disciplinary action against the individual involved.

Sebi’s investigation focused on the suspected front-running of trades executed by PNB MetLife’s “Big Client” by certain entities, including the dealer and fund managers. The inquiry, which spanned from January 1, 2021, to July 19, 2024, found that Sachin Bakul Dagli had been entrusted with most of the company’s trade decisions.

According to Sebi, Dagli and his brother, Tejas Dagli, an equity sales trader at Investec, had access to confidential, non-public information about impending trades. This information was used to execute front-running trades through entities like Dhanmata Realty Pvt. (DRPL), Worthy Distributors Pvt. (WDPL), and Pragnesh Sanghvi. The trading was done using a Buy-Buy-Sell or Sell-Sell-Buy pattern to profit from market movements caused by large client orders.

Sebi’s probe revealed 6,766 instances of such trades, leading to the unlawful gains of ₹21.16 crore. The front-running activities persisted for more than three years, prompting Sebi to restrain the entities from trading securities and to impound the illegal profits earned through these activities.