In a major crackdown, regulator Sebi today slapped a Rs 1 crore penalty on HBN Dairies & Allied Ltd and its directors for mobilising funds from investors through illegal money pooling schemes.
The company had illegally mobilised funds amounting to Rs 1,136 crore from gullible investors through schemes involving purchase of cattle to earn huge returns from sale of ghee.
"The noticees namely the company HBN Dairies and Allied Ltd and its directors launched a CIS (Collective Investment Scheme)... without obtaining certificate of registration from Sebi, thereby contravened the provisions of...CIS Regulations," Sebi said in an order.
The Securities and Exchange Board of India (Sebi) had already prohibited the company and its directors from operating such a business through an order passed in July 2013.
"There is no information available on records in the present proceedings to state that the noticees have operated the schemes beyond the stated date and thus it is assessed that the unregistered activity continued till this date," Sebi said.
Accordingly, the regulator has imposed a fine totalling Rs 1 crore on HBN Dairies and its directors -- Harmender Singh Sran, Satnam Singh Randhawa, Amandeep Singh Sran, Gajraj Singh Chauhan, Manjeet Kaur Sran, Jasbeer Kaur, Rakesh Kumar Tomar, Sukhdev Singh Dhillon and Sukhjeet Kaur.
Earlier in 2016, Sebi had rejected the repayment proposal of the company terming its intention as "malafide". It had found that the firm failed to take any concrete steps for all these years to repay the investors' money despite its own earlier repayment proposal in 2013.
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