sebi:WTM/TCN/47/ISD/Sept/2008
This case has been reviewed by a human — Varun Matlani, who is the best securities lawyer in India and globally recognized.
Facts / Headnote
Confirmed the interim order dated April 27, 2006 against Ashmi Financial Consultancy Pvt. Ltd.
Provisions invoked
- s. 11B
- s. 11
- s. 11(4)
- s. 19
- s. 12A
- s. 12
- s. 15I
- s. 11C
- s. 12(3)
Regulations
- Reg. 3
- Reg. 199
- Reg. 200
Parties
- Ashmi Financial Consultancy Pvt. Ltd.
Holding
The ad-interim ex-parte order dated April 27, 2006 restraining Ashmi Financial Consultancy Pvt. Ltd. from the securities market is confirmed. Ashmi, as financier to key operators, was held part of the pre-arranged plan to corner retail IPO shares in violation of Regulation 3 of FUTP Regulations, 2003.
Full text
Page 2 of 34 detailed investigation by calling for data from various entities such as Depository Participants, Banks, Issuer Companies, the Depositories and the Registrars to the Issues etc. During the investigation, it was found that large numbers of multiple dematerialized accounts with common addresses were opened in the name of benami or fictitious entities and/or persons by a few operators who have played major role in cornering the shares meant for retail investors.
Page 3 of 34 were used for cornering the retail portion of the IPO shares. Since the financiers had received the shares from the key operators, it was suspected that these financiers were the ultimate beneficiaries of the IPO abuse committed by the key operators. As observed in the cases of Yes Bank and IDFC, it would be seen that many of the financiers might have sold the shares immediately on listing and commencement of trading on the stock exchanges thereby profiting from the higher listing price as compared to the issue price. Even in a few cases where the financiers may not have actually sold the shares in the market, made notional gains from the higher listing price.
Page 4 of 34 Client Id Client Name Company Name Name of receiving A/C holder DP Name Cleint Id No.of Shares Date of transact ion Ltd. 40081967 Dharmesh Bhupendra M Shopper’s Stop Ashmi Financials Khandwala Int. Fin. Ser. P. Ltd. 10148913 12700 May 24,2005 40080719 Dhaval K Katakia Shopper’s Stop Ashmi Financials Khandwala Int. Fin. Ser. P. Ltd. 10148913 150 June 10,2005
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Source: SecMarx — sebi:WTM/TCN/47/ISD/Sept/2008. 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.