Sebi bars Sai Prasad Corp from raising money, launch schemes

In a crackdown on an unauthorised money pooling scheme promising high returns, Sebi has barred Sai Prasad Corporation and its directors from raising funds from public and from launching any new investment plans.
The firm and its three directors were allegedly running 'collective investment scheme (CIS)' in the name of its 'joint venture participation business for the development of land'.
The Securities and Exchange Board of India (Sebi) said that Sai Prasad Corporation had raised Rs 137.12 crore from the public in 2012-2013, which increased to Rs 478.35 crore during 2013-2014.
In an order dated July 22, Sebi said that Sai Prasad Corporation was "prima facie engaged in fund mobilising activity from the public" through a CIS "without obtaining a certificate of registration from Sebi".

Citing safety of investors, the regulator said steps were required to prevent the company and its directors -- Balasaheb K Bhapkar, Shashank B Bhapkar and Vandana B Bhapkar -- from further carrying on with the fund mobilising activity.
As per the order, the firm and its directors have been asked "not to collect any money from investors from its existing JV Participation Structure/scheme" and "not to launch any new schemes or plans or float any new companies to raise fresh moneys".

The entities have also been ordered to immediately submit the full inventory of the assets owned by Sai Prasad Corporation out of the amounts collected from the investors.

Besides, the company and its directors have been asked not to dispose of any of the properties or alienate the assets of the existing scheme as well as not to divert any funds mobilised from the public.
The company and its directors would have to furnish all the information sought by Sebi with regard to scheme-wise list of investors alongwith the details of amount mobilised.
The order against the company is the third such ruling by Sebi against a Sai Prasad group firm. In 2013, Sebi had issued similar directions against two other Sai group firms -- Sai Prasad Properties and Sai Prasad Foods.

The three directors of Sai Prasad Corporation were also found to be directors of these other two group firms.
In its latest ruling the market regulator observed that schemes of Sai Prasad Corporation was akin to plans offered by the two other group firms.
Sebi also noted that despite being ordered not to mobilise money from public, the three directors had continued to collect funds.
Sebi had begun a probe in the case after it had received certain complaints last year, alleging that Sai Prasad group of companies were raising funds from public.