Sebi Bars Reliance Home Finance

Sebi Bars Reliance Home Finance, Anil Ambani, 3 Others From Securities Market – TipsOnFinance

The Securities and Exchange Board of India (Sebi) on Friday barred Reliance Home Finance Ltd, billionaire Anil Ambani, and three other persons from trading in the securities market for allegedly siphoning cash away from the firm.

Amit Bapna, Ravindra Sudhakar, and Pinkesh R Shah are the three additional persons that have been identified.

Within the 100-page interim order, the regulator also stated that until further orders, the individuals were not permitted to “associate themselves with any intermediary registered with Sebi, any listed public company, or acting directors/promoters of any public company which intends to raise money from the public.”

In connection with accused siphoning off of cash from the corporation, a court order has been issued against a total of 28 persons and organizations (noticees).

The goal of the Sebi investigation was to take a thorough look at the way in which loans were disbursed by Reliance Home Finance Ltd (RHFL) to a number of borrowing firms during the fiscal year 2018-19.

A letter from Price Waterhouse & Co to RHFL informing them of their resignation as the statutory auditor of the company, as well as complaints received by Sebi alleging siphoning off/diversion of funds from RHFL by the company’s promoters and management, were cited as sources of the current proceedings, according to the regulator.

According to the regulator, there were several Fraud Monitoring Returns (FMRs) from banks stating, among other things, that monies obtained by RHFL from various lenders were partially used to repay debts.

Additionally, it was alleged that numerous associated persons and firms with questionable financials were being utilized as conduits to siphon monies away from RHFL and into entities affiliated with the promoter company Reliance Capital, according to the court order.

“It is noticed that one particular person, Anil Ambani, who controls the firm owing to his position as a promoter and controlling shareholder by virtue of his direct and indirect holdings, is seen to be exercising unrestricted powers…,” the Securities and Exchange Board of India said.

“Instead of bringing such misdeeds to the attention of the Board of Directors/Regulators, the company’s Key Managerial Persons” (KMPs), including Executive Director and CEO Ravindra Sudhalkar and the company’s Chief Financial Officers — Amit Bapna and Pinkesh R Shah — are “prima facie found to be hand in glove with Ambani, in siphoning off the borrowed funds of the company to other financially weak promoter group companies, as

Approximately Rs 900 crore in General Purpose Corporate Loans (GPC loans) were disbursed by RHFL as of March 31, 2018, according to the ruling. By March 31, 2019, the amount of loans disbursed by RHFL had expanded dramatically to approximately Rs 7,900 crore.

Adhar Project Management and Consultancy Private Ltd, Indian Agri Services Pvt Ltd, Phi Management Solutions Pvt Ltd, Arion Movie Productions Pvt Ltd, Citi Securities and Financial Services Pvt Ltd, Deep Industrial Finance Ltd, Azalia Distribution Pvt Ltd, and Vinayak Ventures Pvt Ltd are among the companies that have received notices.

Among those who have received notices are Gamesa Investment Management Pvt Ltd, Medybiz Pvt Ltd, Hirma Power Ltd, Tulip Advisors Pvt Ltd, Mohanbir Hi-Tech Build Pvt Ltd, Netizen Engineering Pvt Ltd, and Crest Logistics and Engineers Pvt Ltd (now known as Cle Pvt Ltd).

In addition to these companies, Reliance Unicorn Enterprises Pvt Ltd, Reliance Exchange next Ltd, Reliance Commercial Finance Ltd, Reliance Cleangen Ltd, Reliance Business Broadcast News Holdings Ltd, Reliance Broadcast Network Ltd, Reliance Capital Ltd, and Reliance Big Entertainment Pvt Ltd have all filed notices with the Registrar of Companies.

the prima facie observations included in this order are based on evidence that is now accessible for review, and the prima facie findings shall also be treated as a show cause notice, according to the regulation

It is also requesting “show cause” as to why an investigation should not be conducted against the noticees (noticees 1 to 28) “for alleged violations of the Sebi Act, 1992, LODR Regulations, and PFUTP regulations,” according to Sebi, who also stated that the noticees have 21 days to file their responses after receiving the order.

They may also indicate if they would want to be given the chance to appear in person at a time and date that will be determined in that respect.

Sebi further highlighted that the restrictions placed on RHFL should not be construed as impeding the implementation of any resolution or revival plan that has been or will be authorized under any legislation.

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