SEBI Uncovers Front-Running Schemes Involving Tiger Global and PB Fintech

SEBI’s Front-Running Probe: Tiger Global, Policybazaar Shares, and the Return of Ketan Parekh

Front-running is one of those old tricks in the trading book—illegal, unethical, and corrosive to investor confidence. It’s also notoriously hard to prove, especially when the networks involved are tight-knit, technically savvy, and operating across borders. But every now and then, the mask slips.

And this time, it’s slipped in a big way.

SEBI’s recent crackdown has uncovered what appears to be a sophisticated, multi-layered front-running ring operating around trades made by none other than Tiger Global, the high-profile American investment fund. At the heart of it? A familiar name from India’s market history: Ketan Parekh.

So, What’s Front-Running, Really?

In plain terms, front-running is when someone gets wind of a large order—typically from a big institutional investor—and trades ahead of it, profiting from the price movement that follows. It’s unfair, it’s illegal, and it undermines the level playing field that capital markets are supposed to offer.

The Web Unraveled: Who’s Who in the Operation

This isn’t just a one-man show. SEBI’s interim order, the result of months of forensic digging, points to a coordinated effort spanning India, Singapore, and possibly beyond.

Here are the main players:

• Tiger Global – The institutional investor whose trades were being exploited. It was offloading a significant stake in PB Fintech, the parent company of Policybazaar. Crucially, Tiger Global has not been accused of any wrongdoing.

• Ketan Parekh – A name that needs little introduction in Indian markets. Once infamous for his role in the 2001 stock market scandal, Parekh appears to be back—this time from the shadows, allegedly orchestrating trades through proxies and encrypted communications.

• Rohit Salgaocar – A Singapore-based trader who, according to SEBI, acted as the go-between. He had a referral arrangement with Tiger Global’s brokers and allegedly passed on advance notice of large trades to Parekh’s network.

• Brokerages & Traders – Three key entities—GRD Securities (FR1), Salasar Stock Broking (FR2), and Anirudh Damani (FR3)—executed the trades based on the privileged information.

The Timeline: What Happened and When

The most telling activity unfolded on November 11, 2022. On that day:

• Two of Tiger Global’s funds sold 52.5 lakh shares of PB Fintech.
• The front-running ring, through the three brokerages mentioned above, matched trades for 20.61 lakh of those shares.
• On the NSE, Tiger Global offloaded 32.84 lakh shares at an average price of ₹388.34 per share—a major block trade.

But this wasn’t a one-day affair.

Over the course of 2022, Tiger Global’s arms—Internet Fund III Pte Ltd and Tiger Global Eight Holdings—sold a combined 1.23 crore shares in PB Fintech. And based on SEBI’s findings, Parekh’s network was consistently positioned just ahead of these large sales, raking in gains from the predictable dips.

The Modus Operandi: Not Just Opportunism, But Strategy

SEBI’s investigation paints a picture of deliberate, repeat execution:

• Information Leakage: Salgaocar received advance trading schedules through his links to Tiger Global’s brokers. These weren’t just speculative tips—they were non-public, highly sensitive trading details.

• Covert Execution: Parekh, still under regulatory scrutiny from his past, didn’t trade directly. Instead, he used multiple pseudonyms, burner phones, and WhatsApp groups to relay detailed trading instructions.

• Broker Network: GRD Securities, Salasar Stock Broking, and Damani executed trades either shortly before or simultaneously with Tiger Global’s sell orders.

SEBI’s order even included screenshots of group chats, multiple phone numbers, and a digital trail of encrypted messages—leaving little ambiguity about intent.

SEBI’s Action: What Comes Next

The crackdown has been swift and decisive:

Name/Entity	Role	Regulatory Action
Ketan Parekh	Mastermind of trade execution	Banned, assets frozen
Rohit Salgaocar	Information conduit	Banned, assets frozen
GRD Securities (FR1)	Front-running trades	Banned, assets frozen
Salasar Stock Broking (FR2)	Front-running trades	Banned, assets frozen
Anirudh Damani (FR3)	Front-running trades	Banned, assets frozen
Tiger Global	Large seller	Not accused of any wrongdoing

• ₹66 crore: That’s the estimated profit made by the network via these trades—money that SEBI now wants clawed back.
• Freezing Orders: Bank accounts have been frozen. Assets are locked. Further disposal of gains has been prohibited.
• Legal Path Ahead: This is an interim order. SEBI is still investigating, and prosecutions could follow.

Why This Case Strikes a Nerve

1. Market Trust Is Fragile

For ordinary investors, front-running isn’t just unethical—it’s a betrayal. The idea that large trades can be anticipated and exploited by an insider group hurts market integrity at its core.

2. Parekh’s Return Shows Old Patterns Die Hard

The fact that Ketan Parekh, long considered persona non grata in India’s markets, is again allegedly pulling strings is alarming. It suggests that regulatory bans aren’t always effective deterrents—unless consistently enforced.

3. SEBI’s Tech and Surveillance Muscle Is Growing

This case also signals a significant leap in SEBI’s capability to trace digital footprints—across WhatsApp, multiple phones, and cross-border entities. The regulator isn’t just watching; it’s following the money in real time.

Final Thoughts: A Case That Could Set the Tone

SEBI’s front-running probe into the Tiger Global–PB Fintech trades is more than a headline—it’s a reminder of how vulnerable markets remain to manipulation, even in an era of algorithmic trades and institutional safeguards.

But the message from the regulator is equally clear: No matter how complex the operation, if it undermines market fairness, it will be found—and stopped.