New Delhi: A special money laundering court here has attached Rs 65 lakh worth fixed despoit receipts (FDRs) of stock market entity Karvy Consultants Limited in connection with the IPO scam of 2005 that had rocked investors across the country.
The case pertains to the scam that was perpetrated in the stock market during the launch of Initial Public Offers (IPOs) floated by two firms — Infrastructure Development Finance Corporation (IDFC) and Yes Bank Limited (YBL) in 2005 where shares meant for retail investors were fraudulently cornered by others. The case was probed by both the Sebi and the CBI.
The Enforcement Directorate (ED) had also registered a money laundering case in this regard in 2007 and subsequently it attached Rs 65 lakh FDRs invested in the name of Karvy Consultants Limited.
The FDRs, at present, are kept in a bank branch in the Banjara Hills area of Hyderabad. “... the preliminary and final enquiries conducted by the Sebi, the investigations conducted by the CBI and the ED including statements recorded and submissions made it a prima facie evident that the defendants had committed (Karvy) the scheduled offence and generated proceeds crime,” the court of Adjudicating Authority of the Prevention of Money Laundering Act K. Raamamoorty said in its latest order confirming the ED action. The Authority is a judicial body to decide on strict enforcement action cases.
According to the ED charge sheet, Karvy had control over the whole process of generation of the idea paper for these two IPOs till the final execution of the involving an intricate web of transfers and re-transfers through the key operators in conjunction with thousands of afferent accounts.
