Key Points
The Securities and Exchange Board of India (SEBI) has issued a show-cause notice to the National Stock Exchange (NSE) regarding allegations that certain high-frequency traders manipulated its software to execute many orders undetected and displace other users from the system..
The TAP software scandal was detected in 2013, but the authority caught up to it during an investigation into the co-location scam by income tax authorities four years later, leading to SEBI's recent intervention..
The Securities and Exchange Board of India has sought an explanation from the National Stock Exchange over an allegation that some high-frequency traders had manipulated its software to fire thousands of orders, without being detected and crowding out other users from the system...
The alleged misuse of the TAP (trading access point) software in 2013 was detected four years later by the income tax authorities during an investigation into the co-location scandal, where former NSE chief executives Chitra Ramkrishna and Ravi Narain are among the accused..
The high-frequency traders involved in the TAP manipulation used special software to bypass the system and even skipped paying the transaction fee to the NSE, one of the people said.. Income tax officials found this in 2017 during a raid on the brokers accused in the co-location scandal..
