Sebi bans Shreysth Production, Shristi Procon from markets

Continuing its crackdown on illicit money pooling activities, Sebi today barred two firms -- Shreysth Production Industries and Shristi Procon -- from the capital markets till further directions.
The Securities and Exchange Board of India (Sebi) found that Shreysth Production raised Rs 62.64 lakh by issuing Redeemable Preference Shares (RPS) to 795 people during 2009-10 and 2011-12, while Shristi Procon mopped-up Rs 2.74 crore by allotting RPS to 1,563 investors from 2010-11 and 2012-13 without complying with the public issue norms.
Under the norms, the firms were required to list its securities on the recognised bourse as the shares were issued to more than 50 persons. It was also required to file a prospectus, among other things, which they failed to do.

In similar-worded orders passed today, Sebi said there was no other alternative but to take recourse through an interim action against Shreysth Production and Shristi Procon and their directors and promoters, for preventing that companies from further carrying on with its fund mobilising activity under the Offer of RPS.
Further, the firms and their directors have been barred from issuing any offer document or advertisement for soliciting money from the public for the issue of securities.
They have been "restrained from accessing the securities market and further prohibited from buying, selling or otherwise dealing in the securities market, either directly or indirectly, till further directions."

The regulator also asked the entities not to dispose of any of the properties or assets acquired by that company without prior permission from the regulator as well as not to divert the funds raised from public.
These directions "shall take effect immediately and shall be in force until further orders".