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SEBI imposes Rs 2,423 crore fine on PACL, 4 directors

Author: IANS/Friday, September 8, 2017/Categories: Regulatory

SEBI imposes Rs 2,423 crore fine on PACL, 4 directors

Mumbai - Securities market regulator SEBI imposed a fine of Rs 2,423.16 crore on PACL Ltd and its four Directors for illegally mobilising Rs 49,100 crore under different schemes.

The SEBI said Rs 49,100 crore was mobilised by PACL over 15 years through unregistered collective investment schemes in violation of the Securities and Exchange Board of India Act, 1992, and SEBI (Collective Investment Schemes) Regulations, 1992.

However, the Rs 2,423.16 crore fine is less than what the SEBI had imposed by its order dated September 22, 2015.

The SEBI had imposed a penalty of Rs 7,269.49 crore under SEBI (Prohibition of Fraudulent and Unfair Trade Practices Relating to Securities Market) Regulations, 2003, to be paid jointly and severally by PACL and its four Directors -- Tarlochan Singh, Sukhdev Singh, Gurmeet Singh, and Subrata Bhattacharya.

But the order was remanded to SEBI by Securities Appellate Tribunal on October 27, 2016, with a direction to the market regulator to pass fresh orders on merit and in accordance with law. 

The SAT said SEBI's Adjudicating Officer should determine the quantum of profits made by PACL.

According to the order, the total amount illegally mobilised by PACL and its four Directors between October 1, 2013, and June 15, 2014, was Rs 2,423.16 crore.

"Though this case deserves imposition of three-fold penalty, as the interest of the investors is paramount, in exercise of the powers conferred upon me under Section 15-I (2) of the SEBI Act read with Rule 5... monetary penalty at least equivalent to the amount mobilised illegally, as set out in Para 19 (l) to (m), i.e. Rs 24,23,16,56,765 is imposed," the Adjudicating Officer said in his order.

The penalty should be remitted within 45 days of receipt of this order jointly and severally by PACL and its four Directors.

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