January 19, 2006
PR No. 40/2006

Cease and desist order in the matter of dealing in the shares by Mathew Easow and his associate entities

SEBI vide order dated January 19, 2005 has issued the following directions in the matter of recommendations given by Mathew Easow on moneycontrol.com in certain shares and the dealing in those shares by Mathew Easow and his associate entities.

1) Mathew Easow to cease and desist from giving any recommendations about any investment in the securities market in any public media which amounts to violation of regulation 4(2)(f) of the SEBI (Prohibition of Fraudulent and Unfair Trade Practices Relating to Securities Market) Regulations, 2003.
2) Mathew Easow Fiscal Services Limited to cease and desist from committing any violation of clause B(7A) of the Code of Conduct for Stock Brokers laid down in Schedule II read with regulation 7 of the SEBI (Stock Brokers and Sub-brokers) Regulations, 1992.
3) M/s Mathew Easow Financial Services to cease and desist from committing any violation of clause B(7A) of the Code of Conduct for Sub-brokers laid down in Schedule III read with regulation 15 of the SEBI (Stock Brokers and Sub-brokers) Regulations, 1992.

4) Investors are cautioned to take informed decisions without being influenced by such recommendations given in the public media.
5) moneycontrol.com being a website with a wide reach, has a responsibility cast on them for exercising due care and diligence to ensure that persons with proven credentials of giving fair and truthful information and analysis alone are allowed to give advise on the portal so that the portal is not misused by persons giving advice purely on considerations of personal gains.
Misleading information affects the market integrity, as unsuspecting investors fall an easy prey to such information while making investment decisions. Such recommendations aired through public media and their influence on the investors has been the concern of SEBI, particularly when they are the manifestations of an undisclosed interest. As a part of ongoing analysis, the recommendations given by Mathew Easow, who is the Chairman of Mathew Easow Research Securities Limited, was examined by SEBI. The recommendations given by Mr. Mathew Easow, when compared with the trading pattern of his associate companies i.e. Mathew Easow Research Securities Limited and Mathew Easow Fiscal Services Limited clearly indicate that Mathew Easow took an opposite trading position in the scrips of Kalpana Industries Ltd, CESC Ltd, Ahlcon Parenterals India Ltd and Albert David Ltd. to what he recommended to the investors at large and he also started selling the stock after giving an opposite advice to the market. 
This indicates an obvious attempt to mislead the investors through investment recommendations, in a striking posture of ambivalence coupled with interest. It was apparent that Mathew Easow was purveying information to the public which he himself did not appear to believe to be true to make unfair gain for himself at the cost of lay investors.
The act of Mathew Easow and his associate entities is in violation of Regulation 4(2) (f) of SEBI (Prohibition of Fraudulent and Unfair Trade Practices Relating to Securities Market) Regulations, 2003. In view of the fact that the said Mathew Easow is a representative of Mathew Easow Fiscal Services Ltd., which is a SEBI registered broker with OTCEI, the intermediary has violated clause B(7A) of the Code of Conduct for Stock Brokers as given in Schedule II read with regulation 7 of the SEBI (Stock Brokers and Sub-brokers) Regulations, 1992. Similarly since he is also a representative of Mathew Easow Financial Services, which is a SEBI registered sub-broker, has failed in ensuring compliance with clause B(7A) of the Code of Conduct for Sub-brokers as given in Schedule III read with regulation 15 of the SEBI (Stock Brokers and Sub-brokers) Regulations, 1992.
 
 
Mumbai

19th January 2006

For full copy of order against MATHEW EASOW, click here.

For full copy of order against MATHEW EASOW FINANCIAL SERVICES, click here.

For full copy of order against MATHEW EASOW FISCAL SERVICES LTD., click here.