IPO scam: CBI raids 15 premises in Ahmedabad

The Central Bureau Investigation (CBI) today conducted raids on 27 premises of stock broking firms and individual brokers in Ahmedabad, Mumbai, Hyderabad and Delhi. The raids were conducted in connection with the IDFC and Yes Bank IPOs scam which led to a loss of Rs 32 crore to the exchequer.

Nearly 15 premises including that of some leading brokers such as Jayesh Khandwala, Gautam Jhaveri, Kamal Jhaveri, Dhiren Vora, Rajan Dabki along with offices of Karvy Stock Broking and residences of managers of Bharat Overseas Bank and Vijaya Bank in Ahmedabad were raided.

The agency also registered cases against Roopalben Nareshbhai Panchal and Deepak Panchal, directors of Sugandh Estates and Investments, and some officials of Bharat Overseas Bank and Vijaya Bank and has charged these people with cornering the shares of the IDFC and Yes Bank using illegal means.

The searches, which began early today, have revealed that one financier who cornered 1.5 lakh shares of IDFC and 30,000 shares of Yes Bank made a profit of Rs 4.6 crore. Similarly, another financier has made a profit of Rs 3.88 crore.

Evidence has also been gathered about one financier routing money through Roopalben N Panchal for investing in the IPOs. The searches have also yielded about Rs 1 crore in cash and substantial investment by these investors in other assets.

In case of one financier, the recoveries include details of 1,100 bank accounts in HDFC, 4,000 bank accounts in ING Vysya Bank and 6,000 d-mat account in Karvy Stock Broking. The same financier has invested Rs 21 crore in these two IPOs.

In this case, the Stock Exchange Board of India (Sebi) had also lodged a complaint following which a case was registered by the bank fraud and securities cell of the CBI and a raid was conducted thereafter, informed sources.

The investing agency is also investigating whether there was any systemic failure on part of the lead mangers, informed sources.