Sebi orders attachment of bank, demat accounts of Beckon Industries

NEW DELHI, (PTI): The Securities and Exchange Board of India (Sebi) on Tuesday ordered the attachment of bank accounts and Demat accounts of Beckons Industries Ltd to recover investors’ money totaling over Rs 11 crore.

The recovery proceedings have been initiated against Beckon Industries Ltd to recover Rs 11.30 crore, which includes all costs, interests, charges and expenses etc, Sebi said.

In the notice, Sebi asked banks and mutual funds not to allow any debit from the accounts of Beckons Industries Ltd (BIL). However, credits have been permitted.

Further, the market watchdog directed all the banks to attach all the accounts, including lockers, held by the defaulter with immediate effect.

To protect the interests of the investors, ”it is necessary to attach the assets of the defaulters, including bank, Demat accounts and mutual fund folios to prevent any alienation of the same,” it said.

In June 2020, markets regulator Sebi levied a penalty totaling Rs 10.25 crore on Beckons Industries Ltd in a matter related to manipulation in the issuance of GDRs.

The order came after Sebi investigated between June 1-30, 2010 to ascertain whether shares underlying GDRs issued by the firm were issued with proper consideration and whether appropriate disclosures were made.

The regulator found that Beckons Industries had issued the GDRs in a fraudulent way by way of the credit agreement and account charge agreement, which was not disclosed to the exchanges and also made misleading disclosures, Sebi said in the order.

The entire GDRs amounting to USD 10.54 million and were subscribed by only one entity, Vintage, on obtaining a loan from EURAM Bank.

Beckons acted as guarantor and deposited the entire GDR proceeds with EURAM Bank as security against the loan for subscribing to the GDRs issued by the firm, thereby violating PFUTP (Prohibition of Fraudulent and Unfair Trade Practices) norms and listing conditions. (PTI)