Sebi restricts Kolkata-based company from mobilising money

In a fresh crackdown on illegal money-pooling schemes, Sebi today prohibited Kolkata-based Sun-Plant Business from raising funds through issuance of securities besides barring the company and its directors from dealing in the stock markets, till further orders.
The company allegedly mobilised more than Rs four crore from about 470 investors from 2005 to 2008 through issue of preference shares.
Sebi had earlier barred various Sun-Plant group firms and their directors from tapping markets for running illegal money-pooling schemes.
Finding prima facie evidence that Sun-Plant Business had engaged in fund mobilising activity from the public, through the offer of preference shares, Sebi said that the company had violated various regulations.

The market regulator observed that the company had issued the securities to over 50 persons which under the rules made it a public issue of securities and hence would require a compulsory listing on a recognised stock exchange.
Among others, the firm was also required to file a prospectus, which it failed to do.

Accordingly in an interim order today, Sebi said that steps were required to be taken in the matter "to ensure only legitimate fund raising activities are carried on by Sun-Plant Business and no investors are defrauded".
The regulator has directed Sun-Plant not to mobilise funds from investors through issuance of equity shares or any other securities, till further orders.

The firms and its directors have been prohibited from the capital markets as well as from issuing offer documents, advertisement for soliciting money from the public for the issue of securities, till further directions.
Further, the Sebi order has asked the company and its directors not to divert any funds raised from public at large.
Sun-Plant has also been asked to provide a full inventory of all its assets and properties as well as furnish complete and relevant information sought by the regulator relating to the matter.
Sun-Plant and its directors are required to submit all relevant information with Sebi within 21 days from the date of receipt of the order.

The company's directors barred from the capital markets are -- Basant Kumar Sasmal, Amit Kumar Chowdhury and Mahesh Chandra Prasad.