Sebi Bans Karvy Stock Broking For Suspected Rs 2000 Crore Scam, Banks Have Rs 1415 Crore Exposure To The Firm

Markets regulator Sebi on November 22 banned Karvy Stock Broking firm from accepting new investors. This comes over allegations of misappropriation of shares and funds of its clients worth about Rs 2000 crore. In a rare move, Sebi passed the order to save investors from further loss. Karvy Stock Broking is one of the largest brokers in the country in terms of client accounts. As of October 31, it had nearly 2.5 lakh clients, data released by NSE showed. Earlier This year, Sebi had received complaints from investors about irregularities. Karvy in short transferred shares from the demat accounts of its client, which were inactive to the demat accounts operated by the broking firm. Karvy then pledged those shares with banks to raise funds. These funds were then transferred to Karvy Realty.