|IPO scam: CBI conducts raids|
New Delhi, Feb 22:
New Delhi, Feb 22: Days after Union Finance Minister P Chidambaram spoke of strict action, CBI today conducted searches in 21 places in three cities in connection with the IPO scam in IDFC and Yes Bank.
The searches followed after the CBI`s bank security and fraud cell registered two cases against some officials of Bharat Overseas Bank and Vijaya Bank and certain individuals for cornering shares which resulted in "illegal gains" of Rs 32 crore to certain individuals.
The searches were being conducted at 15 places in Ahmedabad, five places in Mumbai and one place in Delhi against certain individuals, bank managers and lead managers. Two cases were registered against Roopalben Nareshbhai Panchal, Deepak Panchal, directors of Sugandh Estates and Investments Pvt Ltd, certain officials of Bharat Overseas Bank and Vijaya Bank.
The CBI alleged that these people connived with each other and cornered shares of the IDFC and Yes Bank worth Rs 32 crore through illegal means. Finance Minister P Chidambaram last week in Lok Sabha had promised action against those allegedly involved in a scam relating to the issue of IPO shares by the Yes Bank and the IDFC. All agencies of the government including RBI, SEBI and CBDT have been activated and "severest action" would be taken against those accused, he had said adding while interim action has already been taken and responsibilities fixed against the accused, there would be more action in the coming days.
Click photo and get 2 free: A modus operandi used in IPO Scam
A unique modus operandi was used in the IPO scam in IDFC and Yes Bank in which an accused came out with an advertisement in local dailies asking public to click a photograph and also get two copies free of cost. The advertisement put out by Roopalben Nareshbhai Panchal, one of the main accused in the IPO Scam in IDFC and Yes Bank, saw a large number of people gathering to avail this free service, but least did they know what the photographs would be used for. According to the CBI, the accused used to click photographs and keep one copy for opening fictitious bank and dematerialised (d-mat) accounts.
There were 6,315 fictitious d-mat accounts opened for procurement of yes bank shares out of which 6,221 had the same address of "402-403 Shashwat Building, opposite Gujarat College, Ahmedabad".
In the IDFC Bank, there were 27,064 fake bank accounts out of which 4,990 had the address of "406 Shashwat Building", 4,971 had common address of "403-Shashwat Building" and 4,946 had an address of "307-Shashwat Building". The modus operandi of Panchal was to obtain photographs of large number of people and once they were available, fictitious names along with these snaps were used to open fictitious bank and d-mat accounts. Then an application was made for allotment of these shares to the account holders. Once the allotment was made, the shares were transferred to Panchal`s account, who in turn passed them to financers. These financers offloaded the shares on the opening day of the listing of shares in the stock market and made illegal gains as list price was higher then allotment price.