Sebi bans Asian Corporate; orders to refund investors' money

Regulator Sebi has banned Asian Corporate Consultancy and its proprietor from the capital market for three years for offering unregistered portfolio services, while ordering refund of investors' money.
The entities were providing the services of investment adviser as well as portfolio manager to their clients without obtaining the necessary registrations from the Securities and Exchange Board of India (Sebi)
Total deposits against Asian Corporate and its proprietor Dilip Anantrai Desai was at Rs 55.83 lakh at the end of March, 2013. Out of this, he claimed to have repaid substantial amount (more than 70 per cent) since last two years and the remaining balance is Rs 16.83 lakh.

However, Sebi said that the entities have not submitted any documentary proof in support of the claim of repayment of deposits.
"An independent examination of the bank statement of the noticees for the bank accounts wherein the share trading deposits were credited revealed that the amounts as claimed by the noticees have not been repaid to the customers. The same raises serious doubt on the claim of the noticees that 70 per cent of total deposits have been repaid," Sebi Whole Time Member Prashant Saran said in an order.
Accordingly, Sebi has prohibited Asian Corporate and Desai from "buying, selling or otherwise dealing in the securities market, either directly or indirectly, in any manner whatsoever, for a period of three years."

They have been asked to "expeditiously return the money received from its clients along with the promised returns, in respect of its unregistered portfolio manager and investment adviser activities...And submit a certificate from a peer reviewed Chartered Accountant, within a period of three months."

Besides, they will not undertake any activity in the securities market without obtaining registration from Sebi as required under the securities laws.
This order will come into force with immediate effect.
Earlier, Sebi through an interim order in April 2015, had asked Asian Corporate and Desai to "cease and desist" from acting as investment advisor and portfolio manager, while ordering them not to divert the funds raised from investors.

The market regulator had received a complaint in July, 2014 from a client of Asian Corporate, wherein it was alleged that Asian Corporate had incurred losses on the account and failed to return the money to the complainant as per the agreement.