Sebi bans 24 people, including Anil Ambani, stock market tumbles

Anil Ambani: The Stock Exchange Board of India has banned Anil Ambani and 24 other people, including former officials of Reliance Home Finance Limited (RHFL), for 5 years from stock market fraud. Along with this, the market regulator has banned Anil Ambani from joining the stock exchange for around Rs 25 crore and for five years. This includes joining a listed company or any intermediary registered with the market regulator as a director or key management personnel (KMP). Apart from this, the regulator banned Reliance Home Finance from the bond market for six months and fined it Rs 6 lakh. Shares of Anil Ambani-led companies fell sharply in the stock market on Friday after the news. RHFL down 5.12 percent on NSE Shares of Reliance Home Finance Ltd (RHFL) fell 5.12 percent to Rs 4.45 on NSE and Rs 4.46 after falling 4.90 percent on BSE. . Reliance Infrastructure shares fell 10.83 percent to Rs 209.90 on BSE and 8.89 percent to Rs 214.76 on NSE. Meanwhile, in afternoon trade, the 30-share BSE Sensex was up 57.32 points, or 0.07 percent, at 81,110.51, while the NSE Nifty was up 29.35 points, or 0.12 percent, at 24,840.85. Anil Ambani accused of fraud to extort money According to media reports, SEBI in its 222-page final order said that Anil Ambani hatched a fraudulent scheme to extort funds from the company with the help of key management personnel of RHFL. Shown as a loan to affiliated companies. Although the board of directors of RHFL issued strict instructions to stop such lending practices and conducted regular reviews of corporate loans, the management of the company ignored these orders. Sebi said this shows that some key management personnel acted under the influence of Anil Ambani and there was a grave mistake. Under these circumstances, RHFL should not be equally liable to those involved in the fraud. Anil Ambani misused his position: At SEBI's order, other companies had illegally obtained loans or carried out the process of illegally recovering money from RHFL. SEBI as per its findings vide notice no. 2 (Anil Ambani) to commit fraud was hatched and executed by KMP of RHFL. Through this conspiracy, funds were siphoned off from the public listed company (RHFL) and notice no. 2 (Anil Ambani) were given loans to ineligible borrowers found to be promoters of companies associated with them. Ambani used his position as chairman of ADA Group and his significant indirect stake in RHFL's holding company to commit the fraud. Loans given to companies with no net worth: In its order, it cited the careless approach of the company's management and promoters, under which they sanctioned loans worth hundreds of crores of rupees to companies with no assets or liquidity, net worth or net revenue. According to the SEBI order, this shows that there was some dangerous motive behind the 'loan'. The situation becomes even more suspicious when we consider that many of these borrowers are closely related to RHFL's promoters, SEBI said. According to the SEBI order, RFHL was in debt due to misappropriation of funds and eventually most of these borrowers defaulted on their loans, leaving RHFL defaulting on its own loan obligations. This led to resolution of the company under the RBI framework, putting its public shareholders in a difficult situation. For example, in March 2018, SEBI said the share price of RHFL was around Rs 59.60. By March 2020, as the extent of the fraud became clear and the company ran out of resources, the share price fell to just Rs 0.75. Even now more than nine lakh people have invested in RHFL and are facing huge losses. Also Read: Decorated fridges, fans and 56 poke plates on sale for Janmashtami, SEBI bans 24 people besides Anil Ambani Amit Pabna, Ravindra Sudhalkar and Bingesh R. Shaw is involved. SEBI has also imposed a penalty for his role in the case. Apart from this, Anil Ambani has been fined Rs 25 crore, Pabna Rs 27 crore, Sudhalkar Rs 26 crore and Shah Rs 21 crore. SEBI imposed a fine of Rs 25 crore each on the remaining companies including Reliance Unicorn Enterprises, Reliance Exchange Next LT, Reliance Commercial Finance Limited, Reliance Cleangen Limited, Reliance Business Broadcast News Holdings Limited and Reliance Big Entertainment Private Limited. The penalty is imposed for illegally taking loans from RHFL or acting as an intermediary in illegal transfer of funds. Also Read: Hotstar-Jio Cinema tie-up: Disney-Reliance won't give up cricket rights, ready to make concessions The post Sebi bans 24 people, including Anil Ambani, from stocks appeared first on Prabhat Khabar.