CIS: Sebi orders JSV Developer to refund investors' money

In another crackdown on illegal money pooling schemes, market regulator Sebi has ordered JSV Developer India and its directors to refund investors' money which the company raised through illegal collective investment schemes (CIS).
The Securities and Exchange Board of India (Sebi) has also barred the firm and its directors from the capital market for four years.
It was alleged that the company had launched and operated CIS without obtaining registration from Sebi.
A probe conducted by Sebi found that the company pooled the funds from the investors' in the name of various land schemes including development and maintenance of land and promised returns with interest if the customer does not wish to take land.

"I find that the company pools the funds collected from the investors and utilises for the scheme operated by it," Sebi's whole time member Prashant Saran said.
"It becomes clear that the company does not undertake any real estate business and is involved in schemes which collects money and also assures repayment, where the land is kept as collateral," he added.

Accordingly, the regulator directed the firm and its directors to wind up the existing CIS and refund the money collected by it under the schemes with returns which are due to its investors within a period of three months.

The company and its directors are "restrained from accessing the securities market and are prohibited from buying, selling or otherwise dealing in securities market for a period of 4 years."
In case the firm fails to comply with these orders, Sebi would register a case with the state government or police against them for fraud, cheating and misappropriation of public funds.
Besides, Ministry of Corporate Affairs would initiate the process of winding up of the company.
The directions would come into force with immediate effect.