In its notice, Sebi asked all banks, custodians and mutual funds not to allow write-offs from accounts of Sahara India Real Estate Corp, Subrata Roy, Ashok Roy Choudhary, Dubey and Bharrgava. However, credits are allowed.
The market watchdog has also ordered all banks to seize all accounts, including safety deposit boxes, of defaulters.
The regulator fined a total of Rs 6 crore on Sahara India Real Estate Corp, Subrata Roy, Ashok Roy Choudhary, Dubey and Bharrgava in June.
The case concerns the issuance of OFCDs by Sahara India Real Estate Corporation and Sahara Housing Investment Corporation in 2008-2009. They raised money through the public issuance of securities by issuing OFCDs without following the various procedures intended to protect the interests of the investors, regarding public issuances, prescribed by the standards, according to Sebi order.
According to Sebi, the subscription to the OFCDs was requested by the two companies from the general public across the country without adequately informing them of the risks of the instruments.
The issuance would have been made in violation of the provisions of Sebi’s ICDR (Issue of Capital and Disclosure Requirements) Regulations and PFUTP (Prohibition of Fraudulent and Unfair Trade Practices).
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