Cracking its whip on illegal money pooling schemes, markets regulator Sebi today ordered Vee Realties India to refund investors' money raised through unauthorised collective investment schemes (CIS).
The firm and its directors are also barred from capital markets for four years. They have also been restrained from raising money from investors by launching any CIS.
A Securities and Exchange Board of India (Sebi) probe found the company had mobilised around Rs 22.41 crore from 1,65,291 investors as on May 24, 2014 under its various schemes of selling plots of land and provisional booking of units of agricultural, residential and commercial projects.
Although the company claimed it has refunded 40 per cent of the fund mobilised, Sebi noted that it has not provided any verifiable proof regarding the same.
Further, information regarding the money raised after May 2014 was also not submitted.
"The present case involves a company that has mobilised public funds from gullible investors through its unregistered CIS," Sebi said.
The regulator has directed the firm and its directors to to wind up the existing CIS and refund the money collected by the firm under the schemes with returns which are due to its investors within three months.
Thereafter within a period of 15 days, the firm will have to submit a winding up as well repayment report to Sebi.
In addition, the company and its directors have been barred from selling any assets of the company, except for the purpose of making refunds to its investors.
In case the firm fails to comply with the order, the entities will continue to be barred from the market, even after the completion of four years of restrictions imposed on them "till all the collective investment schemes are wound up and all the money mobilized through such schemes are refunded to its investors with returns which are due to them."
Further, it would make a reference to state government/ local police and register a civil/criminal case against the company and would make a reference to Corporate Affairs Ministry to initiate the process of winding up of the firm.
