IPO scam: 2 persons settle Sebi probe; pay Rs 76 lakh

New Delhi, Jan 15 () Two persons -- Dushyant Natwarlal Dalal and Puloma Dushyant Dalal -- have settled a probe by markets regulator Sebi after paying over Rs 76 lakh towards settlement charge for alleged involvement in the infamous IPO scam of 2003-05.

Securities and Exchange Board of India (Sebi) agreed to settle proposed adjudication proceedings in the case after it was approached by these persons with a settlement application.

They filed a settlement application proposing to settle, "without admitting the findings of fact and conclusions of law" through a settlement order, the pending adjudication proceedings initiated by the regulator for the alleged violation of the PFTUP (Prohibition of Fraudulent and Unfair Trade Practices) norms as well as non-compliance with Sebi's direction.

Besides, they made the payment of over Rs 76.66 lakh towards settlement charges as suggested by the markets watchdog. Advertisement

Consequently, the regulator, through a settlement order passed on Tuesday, said, "the enforcement proceedings for the alleged defaults...are settled".

"Sebi shall not initiate any enforcement action against the applicants for the said default," it added.

The regulator, which had conducted an investigation in the matter of the alleged irregularities during the initial public offering of various scrips, had observed certain irregularities in the transactions in the shares that were issued through the IPOs during the period 2003-05, before their listings on the stock exchanges.
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The two had been accused of making unlawful gains by cornering shares of various companies meant for retail investors.

Sebi, through an ad interim exparte order in April, 2006, had barred Dalals, among other entities, from the capital markets till further directions. The directions were confirmed through Sebi orders passed in September 2008 and July 2009. Subsequently the applicants preferred an appeal before the Securities Appellate Tribunal (SAT) and subsequent civil appeal and review petitions before the Supreme Court which finally got disposed of in August 2011. Advertisement

The regulator in its order said that enforcement actions, including commencing or reopening of the proceedings, could be initiated if any representation made by the persons are found to be untrue. SP BAL
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