Central Bureau of Investigation (CBI) has filed three charge sheets against stock broker Ketan Parekh and six others, including former top executives of Global Trust Bank (GTB), for allegedly entering into a criminal conspiracy and swindling public money to the tune of Rs 250 crore.CBI filed the charge sheets against Parekh, Darmesh Doshi, Jatin S, Kirti Parekh, Kartik Parekh (all directors of companies held by Ketan) and chairman of Singapore-based Brentfield Holdings T L Chandran.Ramesh Gelli, the former chairman and managing director of GTB, which has now been merged with Oriental Bank of Commerce, and its executive director Sridhar Subasiri were also named in the charge sheets filed under various sections of Indian Penal Code and Prevention of Corruption Act at a Mumbai court, CBI sources said here today. Gelli and Subasiri together held 40% stake in GTB.According to one CBI charge sheet, GTB officials allegedly entered into a conspiracy with Parekh and his associates by giving them temporary overdraft facility worth Rs 250 crore without either seeking an application or collaterals or ascertaining the genuineness of "pay-in" requirements.Under the "pay-in" requirements, banks give overdraft facility to registered brokers whose money is expected to come from customers who have been sold shares.Part of these funds were used by Gelli and Subasiri to increase their stake in GTB by purchasing shares from foreign promoters. CBI alleged that the money was also used for manipulation of the stock market by Parekh.The second charge sheet pertains to the violation of Reserve Bank of India's "Group Exposure norm" whereby no individual or a company is given more than 50% of bank's capital for overdraft facility. In this case, the bank continued to provide the overdraft facility to Parekh, and to circumvent this rule, funds were given to some other companies which were later found to be associate companies of Parekh.The money released to these companies were later found to have been routed into the account of Parekh, which was again used to manipulate the stock market, the CBI alleged.The third charge sheet related to alleged bungling in issuance of preferential shares by GTB to meet the capital adequacy norms to generate additional capital.According to the CBI charge sheet, the preferential shares floated were purchased by Parekh and his associates and that too with the funds of GTB. Therefore, the capital claimed by GTB out of the preferential shares was only on the paper as Parekh and his associates had purchased it from the money of the bank, the CBI alleged.According to CBI, Chandran used Brentfield Holdings, an overseas corporate body, allegedly for channelising the funds of Parekh into the stock market.CBI also froze a bank account containing nearly six million pounds at the Credit Suisse Bank, UK, in which stock broker Darmesh Doshi, an associate of Parekh, has controlling interest.
