A group of investment advisers and investor protection body in Dubai have raised questions about the effectiveness of enforcement agencies and securities market regulator in India in view of the blatant flouting of corporate governance guidelines by a few listed companies in India.
In spite of stringent corporate governance guidelines in India, many corporates, including some listed companies, are indulging in activities of fraud with impunity, it is alleged.
The Registrar of Companies (RoC), Securities and Exchange Board of India (SEBI), Bombay Stock Exchange, the Reserve Bank of India and the Prime Minister’s Office (PMO) have been blamed for failing to ensure listed companies conform to the Corporate Governance Law.
Barjeel is a joint venture with Geojit Securities in India, a major brokerage and consultancy firm.
“Investors are taken for a ride by some companies with the ‘right kind of connection’ in connivance with some top officials from these regulatory bodies and government departments. We demand a thorough investigation into the whole affairs to safeguard the interest of the hapless investors,” said KV Shamsudheen, Managing Director of Barjeel Geojit Financial Services, Dubai.
Pravasi Bandhu Welfare Trust, an NGO that takes up the grievances of investors, is preparing a memorandum to be submitted through the Indian Embassy in the UAE and Consulate General of India in Dubai, to the Indian government and SEBI to thoroughly investigate and bring to book the culprits who do fraud on the investors.
The Dubai Chapter of the Institute of Chartered Accountants of India is also joining hands with the Investment Advisers Forum and Pravasi Bandhu Trust to represent to the Indian government to protect the investors and punish the perpetrators.
Among the several cases reported are Anugrah Stock & Broking, Mumbai, and Pune-based Bilcare, listed on the Bombay Stock Exchange.
Mumbai-based brokerage firm Anugrah Stock and Broking Pvt Ltd and its associates were running a Ponzi scheme that defrauded nearly 40,000 investors, including NRI investors, to the tune of Rs 1,400 crore.
Though licensed to act as a stock broker, the company attracted deposits by promising assured returns up to 20%.
Another serious case is of Bilcare, listed on the Bombay Stock Exchange, which has been reporting loss since 2017.
