Latest News |  BIZ-SEBI-ANUGRAH Sebi Suspends Anugrah Stock & Broking Till Completion of Proceedings

New Delhi, Nov 13 (PTI) Markets regulator Sebi on Friday suspended Anugrah Stock & Broking Pvt Ltd (ASBPL) till the completion of enquiry proceedings, after finding it in violation of several market norms.

The matter pertains to involvement of ASBPL in activities other than securities, collecting funds from clients under assured return schemes, misappropriation of clients' funds and securities, among others.

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The firm is a registered stock broker and depository participant. In addition, the regulator also passed directions against the directors of ASBPL, Teji Mandi Analytics, its directors and Om Sri Sai Investments.

Teji Mandi Analytics is registered with NSE as an authorised person of ASBPL while Om Sri Sai Investments is a sister concern of ASBPL.

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Stock exchanges have been directed to expedite the proceedings to declare ASBPL as a defaulter.

Based on market intelligence about ASBPL being involved in business or activities other than securities and collecting funds from clients under assured return schemes, Sebi advised NSE to appoint a forensic auditor.

The findings of forensic audit report submitted by NSE included misstatement about debtors and creditors, shortfall of client funds and client securities, payments made to clients having running debit balance and discrepancies in maintenance of records, among others.

Post disablement of the firm's trading terminals by NSE in August 2020, Sebi has received 2,352 complaints under the Sebi Complaints Redress System as on November 11, 2020, Sebi noted.

Therefore, Sebi found the firm to be in "prima facie" violation of various market norms and the regulator's circulars.

Sebi has thus suspended ASBPL till the conclusion of proceedings.

Till the completion of proceedings ASBPL, its directors-- Paresh Mulji Kariya and Sadhana Paresh Kariya, Teji  Mandi Anlytics Pvt Ltd, its directors-- Anil Gopal Gandhi and Riddhi Kalapi Shah-- and Om Sri Sai Investments have been directed not to dispose of or alienate any assets except with the prior permission of NSE. The direction is also subject to the direction given by the Bombay High Court.

ASBPL, its directors and Om Sri Sai Investments are prohibited from providing any unregistered portfolio management services.

The regulator passed many other directions subject to several conditions.

The proceedings have been initiated against all the entities. Sebi noted that various investors have approached the Bombay High Court seeking relief against ASBPL. The High Court through its order in September 2020 appointed a receiver for the properties of ASBPL.

NSE had issued a show cause notice to Anugrah in July based on the preliminary findings of the forensic audit report, for potentially receiving nearly Rs 165 crore in relation to derivative advisory services from its clients promising assured returns, shortfall of client funds, incorrect reporting of margin, among others.

NSE also withdrew the trading rights of ASBPL in all segments. The firm also failed to deposit Rs 165 crore as directed by the Securities Appellate Tribunal in August.

(The above story is verified and authored by Press Trust of India (PTI) staff. PTI, India’s premier news agency, employs more than 400 journalists and 500 stringers to cover almost every district and small town in India.. The views appearing in the above post do not reflect the opinions of LatestLY)