Imagine a room full of traders. Phones ringing, deals flying, caffeine-fueled chaos. Now, picture someone in that room, not doing any trading, but just… listening.
Quietly. Carefully. Every word, every instruction, every number whispered across the table is being mentally recorded.
Now picture them turning around, placing a trade just moments before a giant institutional order hits the market, and making a killing from it.
That, in essence, is the story of Madhav Stock Vision Pvt. Ltd. (MSVPL) and a tightly knit web of brokers, dealers, and directors who took “front running” to a whole new level, almost like an underground stock market sting operation, except it was real, and very profitable, until SEBI came knocking.
The Setup: One Big Client and Four Brokers
Between April 2020 and December 2023, SEBI started noticing something fishy. A “Big Client” was placing large trades through its trusted network of four empaneled brokers.
But something was off.
Right before the Big Client’s trades were executed, MSVPL was seen placing almost identical trades, same stock, same direction, just seconds or minutes earlier.
It’s like they had a crystal ball. Or maybe, just really good ears.
Who’s Who in This Whisper Operation
Let’s break down the key players:
- MSVPL – The front-runner. The firm is placing the strategic trades.
- Jyotiswaroop Nandkishore Purohit & Pankit Bhagwati Jhaveri – Brokers at one of the empaneled firms, and the main “listeners.” They had access to the Big Client’s order information.
- Rajesh Bhagwati Jhaveri, Ajay Sampatraj Jain & Rajkumar Damani – Directors and dealers at MSVPL. These were the people receiving the whispers and placing trades before the Big Client moved the market.
The scheme was brilliant in its simplicity. The Big Client would place an order. One of the insiders (Purohit or Jhaveri) would get wind of it—either by overhearing calls, reading internal emails, or being directly involved in executing the order.
Then they’d call their friends at MSVPL, who’d jump into the same stock ahead of the Big Client.
When the Big Client’s massive order went through, the price would move in their favor. They’d square off and pocket the profits.
Rinse. Repeat.
The Office With Ears
The real genius of the operation wasn’t high-tech software or secret hacking. It was the location.
Multiple brokers working for the Big Client were operating out of the same building in Malad West, Mumbai—Kemp Plaza.
That’s right, different firms, same floor, next to each other. It was like a Wall Street co-working space. All MSVPL had to do was keep someone close enough to “accidentally” overhear key details.
The dealers were so casual about it, they even joked in recorded conversations:
“Kaan toh apna waise hi tej hai. Dusre cabin mein kya baat hoti hai uspe kaam kar daalte hai.”
(Translation: Our ears are sharp. We act on whatever’s being said in the next cabin.)
In another call, they even discussed placing a second mobile phone in someone’s pocket—switched on during trading hours—so it could relay nearby conversations.
It was like Wall Street meets CID.
The Smoking Gun: Calls, Chats, Emails
SEBI didn’t just rely on suspicion. They launched full-scale raids, seized devices, and pulled call records. What they found was damning:
- Thousands of calls during market hours between the insiders and MSVPL.
- WhatsApp chats sharing trading terminals, credentials, and even screenshots of the Big Client’s email orders.
- Voice recordings confirming they knew exactly what orders were coming and when.
- Even planning how to share the profits across friends, families, and associates.
If it weren’t illegal, it’d be impressive.
The Money Trail
As expected, there was a solid payoff. MSVPL made crores in illegal gains over the years by simply riding the Big Client’s coattails.
The directors tried to distribute the spoils in creative ways, by making family members of the “information carriers” employees of the firm and channeling funds to their accounts.
But SEBI wasn’t fooled.
They traced the entire chain, called everyone out, and passed an interim order banning the involved parties and initiating proceedings.
So What’s the Big Deal?
This wasn’t just insider trading. This was front running at scale, using access, proximity, and good old-fashioned eavesdropping to game the system.
While the Big Client operated in good faith, trusting its brokers, MSVPL exploited that trust by turning the dealing rooms into opportunity zones.
It’s a reminder that not all stock market scams involve fake apps or fly-by-night Ponzi schemes. Some are just a bunch of guys in the right room with the wrong intentions.
Final Thoughts
The MSVPL front-running scandal is a masterclass in how information, when misused, can lead to serious market manipulation. But it’s also a case study in how regulators, with patience and evidence, can slowly unravel the most well-hidden schemes.
For traders, investors, and firms, it’s a wake-up call. Even the smallest leaks in your process can become floodgates for exploitation.
So the next time you’re talking shop on the trading floor, you might want to lower your voice.
Because you never know who’s listening.
