Sebi imposes Rs 72 cr fine on Winsome Textile Industries, directors, 2 others
Winsome Textile Industries Ltd, its directors, and two other persons were fined over Rs 72 crore by market regulator Sebi on Wednesday in a matter involving the firm’s issuing of global depository receipts (GDR). Ashish Bagrodia, Manish Bagrodia, and Satish Girotra are the directors facing the fine.On March 31, 2011, Winsome issued 1.29 million GDRs for USD 9.99 million, with Pan Asia Advisors Ltd serving as the lead manager. Pan Asia Advisors’ managing director was Arun Panchariya.
Vintage FZE was the only subscriber to the GDR issuance, according to the investigation. Vintage’s managing director was Mukesh Chauradiya, and Panchariya was the sole benefactor.
In order to subscribe to the issue, Vintage took out a loan from EURAM Bank. Winsome had offered the GDR earnings as collateral for the loan.
Aspire Emerging Fund sold converted equity shares for Rs 1.11 crore on the Indian securities market, thanks to FII-sub-accounts linked to Panchariya.Furthermore, the firm produced false corporate announcements and neglected to notify stock exchanges of the GDRs’ delisting from the Luxembourg Stock Exchange.
“Winsome misled Indian investors in the securities market into believing that it had received full consideration for GDRs, which was not the case, and so persuaded Indian investors to deal in securities, committing fraud on Indian investors,” Sebi said.
The directors were also complicit in the bogus GDR issuing scam.Winsome, its three directors, Vintage FZE, Arun Panchariya, Mukesh Chauradiya, Pan Asia Advisors, and seven funds have also been prohibited from the securities market for varied periods of time by Sebi.Aspire Emerging Fund has also been ordered to disgorge illicit gains of over Rs 1.11 crore made through the sale of equity shares, as well as 12% interest from the date of sale until the disgorgement sum is paid.
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