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SEBI Orders Attachment Of Bank, Demat Accounts Of Subrata Roy, Others In OFCD Issuance Case

SEBI Orders Attachment Of Bank, Demat Accounts Of Subrata Roy, Others In OFCD Issuance Case

Apart from Sahara, others whose bank and demat accounts were attached are Ashok Roy Choudhary, Ravi Shanker Dubey and Vandana Bharrgava

SEBI
SEBI SEBI

SEBI on Wednesday ordered the attachment of bank and demat accounts of Sahara Group chief Subrata Roy and three others to recover Rs 6.48 crore for violating regulatory norms by two group companies.

The recovery proceedings have been initiated against these four persons for violating regulatory norms in the issuance of optionally fully convertible debentures (OFCDs) by two group companies.

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Apart from Sahara, others whose bank and demat accounts were attached are Ashok Roy Choudhary, Ravi Shanker Dubey and Vandana Bharrgava.

The recovery proceedings have been initiated against these four persons to recover Rs 6.48 crore, which includes all costs, interests, charges and expenses etc, the Securities and Exchange Board of India (SEBI) said in the attachment order.

In its notice, SEBI has directed all banks to attach all accounts, including lockers, of these four persons.

All banks, depositories and mutual funds have been directed not to allow any debit from accounts of these four persons. However, credits have been permitted.

In December 2022, the regulator had ordered attachment of bank and demat accounts of these persons to recover Rs 6.42 crore in the case.

This came after the regulator had issued two demand notices during December-January to Sahara Group firms—Sahara Housing Investment Corporation, Sahara India Real Estate Corporation (now known as Sahara Commodity Services Corporation)— Subrata Roy, Choudhary, Dubey and Bharrgava asking them to pay amount totalling close to Rs 13 crore within the stipulated time frame in the case pertaining to flouting regulatory norms.

Also, the regulator had warned of attachment of assets and bank accounts, if they fail to make the payment within the time limit.

The regulator, in its order in June, levied a fine totalling Rs 12 crore on two Sahara Group firms, Roy, Choudhary, Dubey and Bharrgava -- for violating regulatory norms in the issuance of OFCDs.

The case relates to issuance of OFCDs by Sahara India Real Estate Corporation and Sahara Housing Investment Corporation during 2008-2009.

They raised money through public issue of securities by issuing OFCDs without following the various procedures intended to protect the interest of the investors, in respect of public issues, prescribed under the norms, as per SEBI.

According to SEBI, the subscription towards the OFCDs was solicited by the two companies from the general public in the country, without adequately informing them about the risks involved in the instruments.

The issuance was allegedly done in contravention of the provisions of the SEBI's ICDR (Issue of Capital and Disclosure Requirements) Regulations and PFUTP (Prohibition of Fraudulent and Unfair Trade Practices).

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