Sebi bans DGR Farms & Leisures from raising funds from public

Capital markets regulator Sebi today prohibited DGR Farms & Leisures Ltd and its directors from raising fresh money from investors in a matter relating to violation of public issue norms.
It was alleged that DGR had provided false information about the company to induce people to invest in its shares.
It was also alleged that DGR had illegally mobilised at least Rs 10 crore in a similar manner from about 5,000 investors.
In its probe, Securities and Exchange Board of India (Sebi) found DGR had issued cumulative redeemable preference shares to 191 investors and garnered Rs 1.25 crore between 2009-10 and 2013-14.

The company, through such activities, violated various norms, Sebi said.
The regulator observed that allotment of shares by the firm was a public issue, which under the rules required a compulsory listing on a recognised stock exchange. It was also required to file a prospectus, among others, which it failed to do.

Accordingly, Sebi, in an interim order, has barred the firm from raising "any fresh funds from investors through the offer of preference shares or through any other securities, to the public and/or invite subscription, in any manner whatsoever, either directly or indirectly, till further directions."
Further, Sebi has put several restriction on the firm and its directors, including prohibition from accessing securities markets.

These directions "shall take effect immediately and be in force until further orders.