Continuing its clamp down on illegal money pooling schemes, Sebi today barred Kareena Infotech and its director for luring investors with assured daily returns of Rs 2,000 for five days in a week on annual investment of Rs 1 lakh.
The company and its director Manohar Pillai solicited deposits from the public by posing as a licensed brokerage house.
From the company's website, Securities and Exchange Board of India (Sebi) found that the investment plan is for a period of one year with no risks attached.
"...Kareena would collect a lump sum amount of Rs 1 Lakh towards a 'trading plan' and would pay its clients an assured sum of Rs 2,000 on daily basis for 5 days in a week.
"I note that if such repayment, as promised by Kareeena in its sample agreement is made, a client stands to get upto Rs 5.2 Lakhs a year in return for every Rs 1 Lakh that he invests," Sebi Whole Time Member Rajeev Kumar Agarwal said.
Sebi said that the company made false representations to the investors by representing to them as a SEBI registered entity and solicited investments promising high returns.
"In my view the modus operandi of Kareena and its director Manohar Pillai indicates a scheme, plan, device or artifice or contrivance that is 'fraudulent' as defined in regulation 2(1)(c) of the SEBI (Prohibition of Fraudulent and Unfair Trade Practices) Regulations, 2003," Agarwal said slapping the ban.
According to the regulator, the company and its director also violated certain provisions of the Sebi Act.
Further, Sebi directed Kareena Infotech and its director to immediately remove all advertisements and publications in relation to any activity in the securities market.
The order shall come into force with immediate effect, it said.
