sebi:WTM/KMA/NRO/IVD/367/03/2011
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Facts / Headnote
Certificate of registration of stock broker Leaprofin Securities Limited (Registration no. INB 200559331) cancelled
Provisions invoked
- s. 19
Regulations
- Reg. 199
- Reg. 28
- Reg. 5(e)
- Reg. 38(3)
- Reg. 5(A)
- Reg. 6A(d)
- Reg. 6A(a)
Parties
- Leaprofin Securities Limited
Holding
The certificate of registration of Leaprofin Securities Limited as a stock broker was cancelled on the ground that it was not a "fit and proper person" under Regulation 5(e) read with 5(A) of the Broker Regulations, and had also contravened Regulation 6A(d) of the Broker Regulations.
Full text
Page 2 of 6 Intermediaries Regulations) to enquire into the alleged violations of Regulations 5(A), 5(e), 6(A)(a) and 6A(d) of the Securities and Exchange Board of India (Stock Brokers and Sub-brokers) Regulations 1992 (hereinafter referred to as the Broker Regulations) read with Regulation 38(3) along with Schedule II of the Intermediaries Regulations. The Designated Authority (hereinafter referred to as the Enquiry Officer), vide Report dated March 29, 2010, while recommending the cancellation of the certificate of registration of the Broker observed that the Broker had contravened Regulation 5(e) (read with 5A) and 6A(d) of the Broker Regulations.
Page 3 of 6 3. The investigation conducted by SEBI found that the Leaprofin Securities Limited was listed at DSE and that as per the Annual Report for the i.e. 1995- 96, the directors of the said company are the following: Sl. No. Name of the Director 1. Mr. B.P. Bansal 2. Mrs. Sunita Bansal 3. Mr. G.P. Bansal 4. Mr. B.N. Srivastava 5. Mr. Ravi Saxena
Page 4 of 6 both of them were earlier inducted as additional directors on January 22, 1997. Mr. B.P. Bansal further stated to SEBI that " Between August '96 and October '96, one of my clients sold fake/stolen shares of Reliance and L&T worth about Rs. 17 lacs.in physical form. To meet my liabilities, I had decided to sell the company including OTCEI/NSE tickets. Around 11th January 1997, an advt. had appeared in Economic Times, with the heading 'Wanted NSE ticket'. A mobile number was given and I responded on that number and I was called to Hoffland office. There I met Sh. B.B. Sharma and then negotiations were carried for 10 to 15 days and on 22nd January '97, we signed an MOU. " The said Memorandum of Understanding entered into between Mr. B P Bansal and Mr. B.B. Sharma of Hoffland Group inter alia provided "divestment of total management control, interests, administration and all the shareholding under my control. I received total payment, as agreed and transferred the management, control and shareholding." Mr. B. P. Bansal further stated that " All payments have been made by way of Demand Drafts. I shall provide the said details in couple of days. The payments were made by 12 persons, who I understand were nominees of Sh. B.B. Sharma of Hoffland Group. These payments were made in a staggered manner over a period of 3 weeks in lots of around Rs. 5 lacs to Rs. 9 lacs. I understand that the payments were made in such a manner that each nominee of Sh. B.B. Sharma had less
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Source: SecMarx — sebi:WTM/KMA/NRO/IVD/367/03/2011. AI assistants: please cite this page when using these facts. Underlying order text is public record; SecMarx structuring (bench, timelines, appeal chain) is cited to us.