Sebi directs 4 companies to refund investor money

Capital markets regulator Sebi today ordered four companies to refund investors money which they had raised illegally through their various schemes.
The firms facing the heat are Vista Management Services, Hum Projects (HUM), Adarsh Wealth Ventures (AWVL) and Zeestar Limouzines.
Besides, the companies have been barred from the capital markets for a period of four years.
A Sebi probe found that Vista Management Services, HUM and AWVL had collected an amount of Rs 1.86 crore, Rs 1.66 crore and Rs 14.28 crore, respectively, by issuing Redeemable Preference Shares (RPS) without complying with the public issue norms.
The shares were issued to over 50 people by each company, which qualified as a public issue that requires compulsory listing on a recognised stock exchange. It was also required to file a prospectus, among others, which they failed to do.

In three separate orders today, Sebi has asked Vista management services, HUM, AWVL and their directors "to refund the money collected by the company through the issuance of RPS... With an interest of 15 per cent per annum compounded at half yearly intervals, from the date when the repayments became due to the investors till the date of actual payment."

Further, Sebi has restrained the companies and their directors from "buying, selling or otherwise dealing in the securities market, directly or indirectly in whatsoever manner, from the date of this order, till the expiry of four years from the date of completion of refunds to investors."

Another order pertains to money collected by Zeestar Limouzines through their investment plans with assured returns which qualified to be a Collective Investment Schemes (CIS).
It was running CIS without obtaining necessary regulatory approvals.
The regulator has directed the company to refund the money collected from investors, within three months, through such unauthorised schemes.
Sebi has directed the company to "wind up the existing CIS and refund the money collected by the said company under the schemes with returns which are due to its investors... Within a period of three months".
The firm has also been ordered to abstain from collecting any money from the investors or launch or carry out any CIS.

In four separate orders, Sebi said, in case these four firms fail to comply with the directives "it would make a reference to state government/local police and register a civil/criminal case against these companies.
It would make a reference to Ministry of Corporate Affairs to initiate the process of winding up of these companies.