Sebi raises alarm over grey market operations - Economic Times

MUMBAI: Capital market regulator Sebi has voiced concerns over an alarming rise in grey market investments with thousands of crores being raised through illegal means. "There is a famous instance where a company has claimed that it has refunded more than Rs20,000 crore in the last 3-4 months to so-called investors, out of which more than 90% has been returned in cash. How credible can this story be?" said Sebi chief UK Sinha at a seminar here on Wednesday. Sinha did not name the company but everyone present at the seminar could figure who he was referring to. Sebi is in the midst of a bitter court feud with Sahara which recently challenged the regulator's decision to freeze assets of Sahara chief Subrata Roy. Last year, the Supreme Court ordered two Sahara firms to refund ofRs24,000 crore to three crore investors who had subscribed to convertible debentures. The group has claimed that it has already refunded a majority portion of the money to investors and its total outstanding liability is less than Rs5,120 crore that it has deposited with the regulator. Sinha said the government should come out with a single regulator to tackle the issue of illegitimate money raised in the country through collective investment schemes or CIS. "One area that I would like to point out and which concerns me as a regulator is the rapid development of the grey market investment in this country. The audacity and the frequency at which it is happening is something all of us must take note of," Sinha said at a seminar on investment outlook for 2013 organised by the Indian Merchants Chamber. Copyright © 2013 Times Internet Limited. All rights reserved. via Business - Google News http://news.google.com/news/url?sa=t&fd=R&usg=AFQjCNF_Lt0rK5mWQvslwqUeS0uP89uhpw&url=http://economictimes.indiatimes.com/markets/regulation/sebi-raises-alarm-over-grey-market-operations/articleshow/19371453.cms

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