Sebi today imposed a total penalty of Rs 3.5 crore on Onelife Capital Advisors and its two top executives for multiple violations including non-disclosure of certain important information in its IPO prospectus and misutilisation of issue proceeds.
Apart from the company, penalty has been imposed on its Managing Director Pandoo Naig and Executive Chairman TKP Naig.
Sebi said the entities "had acted in a manner highly detrimental to the interests of the securities market and the investors at large cannot be overlooked".
Onelife Capital has been slapped with Rs 40 lakh penalty and together with TKP Naig another fine of Rs 5 lakh. Besides, it imposed a penalty of Rs 1.5 crore on TKP Naig. A fine of Rs 1.55 crore has been slapped on Pandoo Naig.
The company's Rs 36.85 crore IPO -- which was open for subscription from September 28 to October 4, 2011 -- was oversubscribed.
Noticing suspicious transfer of the company's IPO proceeds to certain entities, an investigation was done.
The probe revealed that Onelife Capital had made mis-statements and failed to disclose certain material developments in its IPO prospectus. It was also found that the firm utilised the proceeds for purposes other than the objects stated in the prospectus.
From the IPO proceeds, Onelife Capital transferred Rs 15.55 crore to Fincare Financial and Consultancy Services Pvt Ltd, Rs 12 crore to Precise Consulting & Engineering Pvt Ltd and Rs 7.7 crore to KPT Infotech Pvt Ltd.
Onelife Capital had contended that it had not diverted the IPO proceeds and information submitted to the exchanges regarding the proceeds of the IPO was true and correct.
Noting that the contention cannot be accepted, Sebi said it has been clearly established that the company had indulged in fraudulent act "whereby it had diverted the entire issue proceeds amounting to Rs 35.5 crore to dubious entities having poor credentials/ financials".
