Sebi fines 2 Sahara companies Rs 12 crore

MUMBAI: Markets regulator Sebi has imposed a fine of Rs 12 crore on two Sahara Group companies and some of the board members of these two entities, including Subrata Roy Sahara, for violating laws that govern fund-raising by corporates. The two entities are Sahara India Real Estate Corp (SIRECL) and Sahara Housing Investment Corp (SHICL).
According to the report, when Sahara Prime City (SPCL) had filed for its IPO in 2009, Sebi found that the two entities, SIRECL and SHICL had, between 2008 and 2009, raised funds through optionally fully convertible debentures (OFCDs).The fund-raising process for each of the companies had violated Sebi’s rules for collecting funds from the public.
Sebi found that the two companies had “raised sizable amounts of money from the public without conforming to the prudent disclosure requirements and other investor protection norms/requirements which govern public issues”, the report said. When Sebi was examining the IPO papers of SPCL, it also received complaints that SIRECL was issuing convertible bonds to the public throughout the country for the past several months, details of which were not disclosed in the IPO papers.
After several court cases over the years, Sebi had in 2013 closed SPCL’s IPO file. On Monday, Sebi fined SIRECL, along with Roy, Ashok Roy Choudhary, Ravi Shanker Dubey and Vandana Bhargava a total of Rs 6 crore. An equal amount of fine was also imposed on SHICL and the four directors.