The Securities and Exchange Board of India (SEBI) has levied a penalty of ₹40 lakh on Shri Ram Real Estate & Business Solutions, along with six individuals, this past February. The action stems from accusations that the entity unlawfully garnered ₹40,000 from the public through collective investment plans, more commonly called schemes.
Market regulator SEBI stated that the company and the individuals were involved in soliciting funds from the general population using methods tied to collective investment strategies.
Infractions in Investment Schemes
SEBI, through an order issued this Monday, contends that offerings from Shri Ram Real Estate and Business Solutions Ltd (SRE and BSL) masqueraded as investment schemes under the veil of 'plot sales and land acquisitions'. The inquiry revealed that the company failed to secure proper registration aligning with Collective Investment Scheme (CIS) standards.
Allegedly, SRE and BSL amassed about ₹12.01 crore from a pool of 382 individual investors over the fiscal years 2008-09 to 2013-14, utilizing multifaceted schemes. SEBI consequently sanctioned the company and associated individuals, decreeing that these penalties, targeting directors during the fundraising tenure, should be discharged either collectively or individually.
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