BJP WANTS SPECIAL TASK FORCE AND CBI INVESTIGATION ON DEMAT SCAM
This is the biggest Public Issue-IPO Scam of the Indian Capital Market. More than 5 crore shares of the Small Investors have been siphoned off through 53 Public Issues of 2004 & 2005. It is shocking that inspite of repeated announcements by the Finance Minister, Shri P. Chidambaram, the scam of 1,00,000 bogus Demat accounts has taken place. The scam began on 16th Aug. 2004 when Roopalben Panchal, Sugandh Investment opened 10,669 bogus fictitious Demat accounts, stated Dr. Kirit Somaiya, ex MP and All-India Convenor – BJP Investors’ Cell.
SEBI, RBI and Income Tax Dept. have accepted the enormity, size of the scam. They are unable to take action against the scamsters due to lack of directives from the Finance Ministry, lack of commitment and clarity among the Regulators and the sytem. 3 months are over the scam has been exposed. All the names are out. Even then no firm, strong action have been taken either by SEBI, RBI or the Finance Ministry. BJP demanded CBI inquiry of the scam. BJP will also raise this issue in the ensuing Parliament session.
It is shocking that, instead of acting against the scamsters, recovering hundreds of crores of Rupees duped by the scamsters, the Finance Ministry is coming out with a proposal to scrap the Small Investors’ quota. BJP will oppose any such move to crush the Small Investors. It was BJP-NDA Government, which not only encouraged more and more Small Investors in the Capital Market, but also offered shares at 5% discount of Govt. PSUs.
The Small Investors’ quota is now 35% in a Public Issue/IPO. It is to be increased to 50 %. The Scamsters, Syndicate, with the help of Bankers and Karvy Depository, cornered, hijacked large chunk of these Small Investors’ quota and their portion of shares of various major Public Issues of 2004 and 2005.
BJP also demanded criminal action against the scamsters. Dr. Somaiya expressed surprise why SEBI and RBI are delaying criminal action. There is a clear provision under Sec.68A Sub-sec. 1 of the Companies Act 1956 –
“Any person who:
a) Makes in a fictitious name an application to a Company for acquiring or subscribing for any shares therein, or
b) Otherwise induces a Company to allot, or register any transfer of shares therein to hi, or any other person in a fictitious name, shall be punishable with imprisonment for a term which may extend to five years.”
BJP demanded that Finance Ministry, SEBI and RBI should come out with a White Paper giving full information about the companies, scamsters, investors, bankers, DPs involved in the scam.
SEBI, RBI and Income Tax Dept. have accepted the enormity, size of the scam. They are unable to take action against the scamsters due to lack of directives from the Finance Ministry, lack of commitment and clarity among the Regulators and the sytem. 3 months are over the scam has been exposed. All the names are out. Even then no firm, strong action have been taken either by SEBI, RBI or the Finance Ministry. BJP demanded CBI inquiry of the scam. BJP will also raise this issue in the ensuing Parliament session.
It is shocking that, instead of acting against the scamsters, recovering hundreds of crores of Rupees duped by the scamsters, the Finance Ministry is coming out with a proposal to scrap the Small Investors’ quota. BJP will oppose any such move to crush the Small Investors. It was BJP-NDA Government, which not only encouraged more and more Small Investors in the Capital Market, but also offered shares at 5% discount of Govt. PSUs.
The Small Investors’ quota is now 35% in a Public Issue/IPO. It is to be increased to 50 %. The Scamsters, Syndicate, with the help of Bankers and Karvy Depository, cornered, hijacked large chunk of these Small Investors’ quota and their portion of shares of various major Public Issues of 2004 and 2005.
BJP also demanded criminal action against the scamsters. Dr. Somaiya expressed surprise why SEBI and RBI are delaying criminal action. There is a clear provision under Sec.68A Sub-sec. 1 of the Companies Act 1956 –
“Any person who:
a) Makes in a fictitious name an application to a Company for acquiring or subscribing for any shares therein, or
b) Otherwise induces a Company to allot, or register any transfer of shares therein to hi, or any other person in a fictitious name, shall be punishable with imprisonment for a term which may extend to five years.”
BJP demanded that Finance Ministry, SEBI and RBI should come out with a White Paper giving full information about the companies, scamsters, investors, bankers, DPs involved in the scam.
( Shyam Jaju )
Office Secretary
Office Secretary
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