GDR manipulation: Sebi applies a fine of Rs 16 to Sanraa Media, its 6 officials

New Delhi, December 2 () The Sebi regulator imposed a fine of more than 16 rupees on Sanraa Media Ltd and its six officials in a matter related to the handling of global deposit receipts (RDA).

The order comes under an investigation carried out by Sebi in relation to several Indian companies that had issued RDA in the foreign market with the intention of defrauding Indian investors.

Sebi discovered that Sanraa Media is one of those companies that had fraudulently promised its earnings from the GDR with the Lisbon-based bank Banco Efisa S.F.E., S.A., as collateral against the loan of the DDR subscribers.

The regulator said Sanraa had issued 10 million RDA worth USD 27.50 million in May 2008 on the Luxembourg Stock Exchange. Clifford Capital Partners AGSA was the only entity that subscribed to the entire GDR issue.

Clifford paid the subscription amount for the RDA after obtaining a loan from Efisa Bank and Sanraa had promised the RDA earnings to the bank against the loan granted to Clifford for the subscription of the RDA, Sebi said.

For this, the Sanraa board had approved the resolution on the loan agreement with Clifford and, therefore, was part of the fraudulent agreement to facilitate the subscription of its own RDA.

In addition, the company made a false and misleading corporate announcement that its GDR problem was successfully assigned to five entities, while it was subscribed by a single entity.

In doing so, the entities violated several market rules and, accordingly, fined the entities.

Of the total fine imposed by Sebi, a penalty of Rs 10.3 million is imposed on the company and Rs 5 million on President Annaswami Venkatramani. Five directors can jointly or jointly pay a fine of Rs 1 crore. The directors facing the penalty are Uma Karthikeyan, Sukumar Subramanian, Rajeev Agarwal, Krishnan Rajagopal and Rajendran Sivashankaran. SRS ANU

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