Anand Rathi flags ₹13 crore fraud linked to off-market share transfers

Anand Rathi Share and Stock Brokers has reported a suspected ₹13-cr fraud involving off-market share transfers from a client's demat account and said it has begun legal action and tightened controls

Anand Rathi Share and Stock Brokers on Friday disclosed a suspected fraud involving an off-market transfer of shares worth about Rs 13 crore from the demat account of a Pune-based client, prompting the company to initiate legal action and tighten internal controls.

 

What did Anand Rathi disclose in its stock exchange filing? 

In a stock exchange filing, the brokerage said its internal inquiry committee found that unknown individuals, in connivance with certain employees of Anand Rathi IT Private Limited, were involved in offences including fraud, cheating, and fabrication of documents and electronic records. The incident relates to depository operations and does not involve broking activities, the company clarified.

 

When did the alleged fraud take place? 

The alleged fraud occurred on February 6 at around 1 pm and involved off-market transfers of securities from the client’s demat account, the filing said.

 

What action is the company taking? 

The company said it is in the process of initiating appropriate legal action, including the registration of a First Information Report. An initial complaint has already been lodged with Pune Police and the N M Joshi Police Station in Mumbai.

 

How is the firm responding internally? 

“Necessary steps are being taken to strengthen internal controls to prevent recurrence,” the company said, adding that further updates would be provided in line with regulatory requirements.

 

What is the status of the investigation and market reaction? 

Investigations into the persons involved are ongoing, the company said. Shares of the company last closed at Rs 572. The disclosure was made after market hours.