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GLOBAL RESEARCH LIMITED
SCAMS A 1992 HARSHAD MEHTA SECURITIES SCAM THE MEMOIR OF THE INDIAN MARKETS SCAMS lot is heard in the past and till today we hear a lot about the financial markets scams. When the scheme was exposed. Once these fake BRs were issued.000 crore. It acts as a receipt for the money received by the selling bank. both the parties may not know each other. the banks started demanding the money back. the seller of securities.capitalvia.com | 2 . The borrowing bank actually sells the securities to the lending bank and buys them back at the end of the period of the loan. which issue fake BRs. the borrower. for a fee”. “Two small and little known banks . When time came to return the money. to Rs.bank receipt promises to deliver the securities to the buyer and the seller holds the securities in trust of the buyer. The deal was done between the banks through brokers for commissions. These banks were willing to issue BRs as and when required. while the buyer gave the cheque to the broker. gave the buyer of the securities a BR. 5000 crs. The bank lends against government securities. The money due to the bank was returned. The game went on as long as the stock prices kept going up. In this settlement process. Our report is one such initiative to highlight a few scams in India.the banking system had been swindled of a whopping Rs 4. Having figured this out. www. The amount that was involved in this scam was approx. Thus . triggering a rise in the Sensex. Harshad in his scam took the help of Bank Receipts. In a ready forward deal. Harshad Mehta known to be “Big Bull of the trading floor” was an Indian stockbroker and is alleged to have engineered the rise in the BSE stock exchange in the year 1992. That is. the shares were sold for a profit and the BR was retired. Instead. Hence the name . The broker was dipping illegally into the banking system to finance his buying.He and his associates draw off funds from inter-bank transactions and bought shares heavily at a premium across many segments. 5000 crs How Harshad Mehta financed his deals? Harshad Mehta worked on the mechanism of READY FORWARD (RF) DEALS. who then made the payment to the seller. causing the collapse. securities were not moved back and forth in actuality. the seller handed over the securities to the broker.came in handy for this purpose. a lot of banks were left holding BRs which did not have any value . who passed them to the buyer. and no one had a clue about Mehta's modus operandi. It was this idea that made the mind of Harshad to involve into the modus operandi.e. deliveries of securities and payments were made through the broker. Financial Market Scams are the attempts by scamsters who indulge in crooked activities to fulfil the bellies of their own at the stake of common man. obviously assuming that they were lending against government securities when this was not really the case. Mehta needed banks. how it was done and the money that was involved in these scams. Once the scam was exposed though. It's a secured short-term (typically 15-day) loan from one bank to another.the Bank of Karad (BOK) and the Metropolitan Co-operative Bank (MCB) . This money was used to drive up the prices of stocks in the stock market. A BR “confirms the sale of securities. they were passed on to other banks and the banks in turn gave money to Mehta. i. typically at a slightly higher price. These scamsters through various fraudulent activities gather big chunks of money. SCAMS GLOBAL RESEARCH LIMITED Rs. or BRs not backed by any government securities.
150. 7000 crore highlighted earlier. Zee Telefilims. The UTI continued to buy these shares even when their market value began to crash in mid-2000. it was this that led to the collapse of the market and the scam discovered. This led Mr. which helped him create a trading ring of his own. Also. and invest huge amounts in junk bonds all for a fat commission. A bear cartel started disrupting Parekh's party by hammering prices of the K-10 stocks. The investments of the individuals were basically done in debt. This whole story led to the ultimate decline of the fund.capitalvia. Between 1999 and 2000. Small investor's funds were . He was a key player in the Ketan Parekh scam. Scrips like Visualsoft rose from Rs 625 to Rs 8. The amount of the scandal than grew bigger than the Rs. 2008 SATYAM SCAM Rs. he started rigging up stock prices. Global Tele. and Parekh used the financial institutions like the UTI to control the situations. He was involved in rigging up the stock prices. A chartered accountant by training. www. Huge amount of UTI funds were channelled into the infamous K-10 list of Keten Parekh stock. shower favours to politicians. By the time he became famous to rig the prices everyone be it investment firms. such as Himachal Futuristic. 10. used to promote big business houses. SCAMS GLOBAL RESEARCH LIMITED Rs. The inflated stocks had to be dumped to someone in the end. The UTI (of which the US-64 scheme is the largest) was set-up specifically to channel small savings of citizens into investments giving relatively large returns/interest. overseas corporate bodies etc .com | 3 . DSQ. but after the liberalization of the economy more allocation was made to equity investments. The US-64 did not came under SEBI regulations. the Indian Markets at that time were also flourishing.000 crs Ramalinga Raju founded Satyam Computers in 1987 and was its Chairman until January 7. In order to hide the company's poor performance during the quarters he indulged in falsifying accounts. the founder indicated that Satyam's accounts had been falsified over a number of years. promoters of listed companies.SCAMS 2001 KETAN PAREKH SCAM Ketan Parekh is a former stock broker from Mumbai.448 per share and Sonata Software from Rs 90 to Rs 2. India. He admitted to an “accounting fraud” to the tune of 7000 crore. In January 2009. 2009 when he resigned from the Satyam. all were ready to hand the money to him. its investment details were kept secret and the chairman has arbitrary powers to personally decide its investment. He rigged up the prices by borrowing from big banks and Investment firms. for involvement in the Indian stock market manipulation scam in late 1999-2001. in order to prop up the share values of these stocks. when technology bubble was seen in the world. Parekh came from a family of brokers. 4800 crs The Unit Trust of India is the largest mutual fund in the country created in 1964. he had also used dummy accounts to trade in Satyam's shares. P Subramanyam the chairman to involve himself in the fraud. who was convicted in 2008. violating the insider trading norm. etc.S. 1250 crs 2001 UTI SCAM Rs.
dirty money is seen in abundance in other cases too. 60. 1661 crore and the company board soon after sold a 60% stake in their wireless division for Rs. a hotel in Thailand. He was charged with laundering money worth over Rs. It is alleged that A. Similarly. 4000 crores. 6200 crore to Telenor. 4000 crore — almost a fifth of the annual budget of the state he once ruled — were unearthed. the Unitech Group. 2006 and remained in office until he resigned on 23 August 2008. 60000 crs which the street knows.com | 4 . Swan Telecom. bought a license for Rs.capitalvia. Crs) 4. In nationwide raids by the Enforcement Directorate. He is alleged to have involved in Money- laundering and mining scam. assets allegedly worth Rs.000 650 5. The nature of the selling of the licenses was that licenses were to be sold at market value. 4200 crore. Involved ( Rs. property in Kolkata. money laundering. He was sworn in as the fifth Chief Minister of Jharkhand on September 18. purchased a license for Rs. Raja arranged the sale of the 2G spectrum licenses below their market value. Year 1992 1994 1995 Scam Name Harshad Mehta Securities Scam Sugar Import Scam Preferential Allotment Scam Meghalaya Forest scam Yugoslav Dinar Scam Approx. OTHER SCAMS DIRECTORY These are some of the big scams that we have highlighted above. and a coal mine in Liberia. 1537 crore. Shortly thereafter. 1971) is an Indian politician who was Chief Minister of Jharkhand from 2006 to 2008. The 2-G Spectrum case is still on and the approximate figures that this scam involves is Rs. and the fact that the licenses were quickly resold at a huge profit indicates that the selling agents issued the licenses below market value. 4000 crs Madhu Koda (born January 6. bribery. The practice of fraud. SCAMS GLOBAL RESEARCH LIMITED Rs. politics. which they would use to create for 2G subscriptions for cell phones.000 300 400 www. Among others. We are highlighting the scams and the money involved in the same.SCAMS 2008 THE 2-G SPECTRUM SWINDLE The 2G spectrum scam involved officials in the government of India illegally undercharging mobile telephony companies for frequency allocation licenses. the board sold 45% of the company to Etisalat for Rs. these assets were reported to include hotels and three companies in Mumbai. a new company with few assets. a company formerly invested in real estate and not telecom.000 crs 2009 MADHU KODA SCAM Rs. Amt.
800 595 1.000 10.500 374 400 1.300 SCAMS GLOBAL RESEARCH LIMITED 133 950 1.000 4.200 8.com | 5 .000 www.500 175 50.00.000 4.000 130 2. Crs) 1.500 7. Amt.250 600 172 146 17 18.R.978 1. Involved ( Rs. Bhansali Stock Scam 1998 2001 Teak Plantation Swindle UTI Scam Dinesh Dalmia Stock Scam Ketan Parekh Securities Scam 2002 2003 2005 Sanjay Agarwal Home Trade Scam Telgi Stamp Paper Scam IPO-Demat Scam Bihar Flood Relief Scam Scorpene Submarine Scam 2006 Punjab's City Centre Project Scam Taj Corridor Scam 2008 Pune Billionaire Hassan Ali Khan Tax Default The Satyam Scam Army Ration Pilferage Scam 2G Spectrum Swindle State Bank of Saurashtra Scam Illegal Monies In Swiss Banks 2009 The Jharkhand Medical Equipment Scam Rice Export Scam Orissa Mine Scam Madhu Koda Mining Scam Approx.000 95 71.SCAMS OTHER SCAMS DIRECTORY Year 1996 Scam Name Fertiliser Import Scam Urea Scam Bihar Fodder Scam 1996 Sukh Ram Telecom Scam SNC Lavalin Power Project Scam Bihar Land Scandal C.capitalvia.000 60.000 5.
Investment in Stocks has its own risks. Any surfing and reading of the information is the acceptance of this disclaimer. greed. It's not that these scams are coming to the highlight these days it's a sin that is present since years. can change without notice. The poorer become poorer and the richer the richest. Our Clients (Paid Or Unpaid). however. but we do not accept any responsibility (or liability) for errors of fact or opinion. The stock price projections shown are not necessarily indicative of future price performance. All Rights Reserved.com | 6 . The information contained herein is based on analysis and up on sources that we consider reliable. dirty money. It is understood that anyone who is browsing through the site has done so at his free will and does not read any views expressed as a recommendation for which either the site or its owners or anyone can be held responsible for. do not vouch for the accuracy or the completeness thereof. The frauds in the financial markets have been known since years. Sincere efforts have been made to present the right investment perspective. We. And when they are actually caught in the trap it's too late and the Common Man already suffers.capitalvia. Bribery. Users have the right to choose the product/s that suits them the most. our website & all the service we provide are believed to be reliable. This material is for personal information and we are not responsible for any loss incurred based upon it & take no responsibility whatsoever for any financial profits or loss which may arise from the recommendations above.SCAMS CONCLUSION Disclaimer The information and views in this report. politics have all helped the scamsters to survive. together with all estimates and forecasts. So. CapitalVia does not purport to be an invitation or an offer to buy or sell any financial instrument. The greed of the scamsters leads to involvement in unhealthy practices and corruption. It's the common man who has always been at stake. Any third party or anyone else have no rights to forward or share our calls or SMS or Report or Any Information Provided by us to/with anyone which is received directly or indirectly by them. SCAMS GLOBAL RESEARCH LIMITED www. If found so then Serious Legal Actions can be taken. always be careful with your investments everywhere. Analyst or any person related to CapitalVia might be holding positions in the stocks recommended. The information herein.
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