Sebi asks Tamil Nadu-based firms to refund money in 3 months

Market regulator Sebi today asked Target People Social Security Scheme Micro Finance and Fishermen Development Micro Finance to refund money raised from investors with interest of 15 per cent per annum within 3 months in cases related to illegal issuance of equity shares.
In two separate orders, the two Tamil Nadu-based firms and their directors were restricted from dealing in securities as well as raising funds from the capital markets till the refund is completed.
Besides, the respective directors of the companies are also restrained from associating themselves, with any listed public company and any public company which intends to raise money from the public, till the refund of money is made to the allottees as directed.

As per Sebi orders, the firms had issued equity shares to more than 50 persons, they were required to get listed on a stock exchange, among others.
Target People had made series of allotments of equity shares between June 29, 2013 and August 21, 2013 to 10,043 persons aggregating to Rs 5.19 crore.
Meanwhile, Fishermen Development had allotted 51,995 equity shares to 3,410 persons aggregating to Rs 5.20 crore.

In its rulings, Sebi said the companies and their directors have to "within three months from the date of this order, jointly and severally refund the money collected" to the allottees "along with interest at the rate of 15 per cent per annum from the date of receipt of money till the date of such refund".

The directors of the companies are also "restrained from associating themselves, with any listed public company and any public company which intends to raise money from the public, till the refund of money is made to the allottees as directed hereinabove".
The Sebi said the appropriate action would be initiated against the entities in case of failure to comply with the directions.