It found the firm, registered as a broker on both the National Stock Exchange and the Bombay Stock Exchange, to have executed trades of another broker C. Mackertich Ltd or CML which, Sebi claimed, was acting as unregistered sub-broker in violation of the law.

"By allowing CML to act as unregistered sub-broker, CSFB has miserably failed to abide by Code of Conduct prescribed for a broker. Further, the possibility that the very trades executed by CML through the terminal of CSFB, forming part of the trades which led to the manipulation of the scrip of South East Asia Marine Engineering and Constructions, can also not be ruled out. In any event, the fact remains that CSFB allowed its terminal to be misused by CML," G G Anantharaman, Whole Time Member, Sebi, said in his order today.

According to the regulator, between June 01, 1999 to May 31, 2000, CSFB traded in the scrip on behalf of CML and its own partner company Kallar Kahar Investment and another firm Milhill Investment Limited. During the period the share-price moved from Rs.15 to Rs.389 within 8 months, it pointed out.

"In the investigation, from the trade log of BSE it was also observed that CSFB was continuously executing buy trades for the smaller quantities at the next higher prices, even when the rates of scrips were falling. Therefore it was concluded in the investigation that CSFB was interested in the increase in the price of the scrip," the Whole Time Member pointed out.

While the SAT had last month upheld the Sebi order against Ketan Parekh, it felt that CSFB and DKB got away with lesser punishments. Sebi had banned CSFB for 18 months and DKB for two years. "The board was not justified in letting off the two brokers lightly by imposing on them a penalty which was clearly disproportionate to the gravity of the charges proved against them," the SAT's final order said.