New Delhi: Sebi on Friday clamped down on an investment scheme involving collection of public funds for purchase of cattle to earn huge returns from sale of ghee. The regulator asked the company as well as its directors to initiate the process for refunding Rs 1,100 crore to investors.
The operator of this scheme, HBN Dairies & Allied Ltd, has also been barred from disposal of assets totalling over Rs 1,000 crore, except for the purpose of winding up of its schemes, and refund of investor money with promised returns.
Sebi said in an order, which has come into force with immediate effect, that HBN and its nine directors can't solicit any further money from investors or its customers into these schemes. Besides, they have also been barred from launching or carrying out any other money collection schemes.
HBN and its directors have also been asked to submit to Sebi within 30 days a "reasonable proposal including firm time lines with regard to the manner in which it proposes to wind up its schemes and make payments along with the returns which are due to its investors".
Sebi said these directions are without prejudice to any further actions that might be taken in this case.
The regulator has been taking action against a host of entities running illegal money collection schemes. Some of the entities that have faced Sebi action recently include Sumangal for a potato investment scheme, Rose Valley for a holiday membership scheme and the infamous Saradha case of West Bengal.
Sebi began HBN probe following receipt of complaints that it was illegally collecting money from the public.
Subsequently, SEBI wrote to HBN in February 2009 seeking details like applications forms, brochures, sample agreements, balance sheets, profit and loss accounts, details of the past and present directors, details of funds mobilized under various schemes, to ascertain whether it was running unauthorized collective investment schemes.


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