Sebi asks Ally Multitrade to repay investors' money

Securities and Exchange Board of India (Sebi) has ordered Ally Multitrade India and its directors to refund all the money illegally raised from investors, along with promised returns within three months.

Besides, the capital market regulator has barred the company and its director from the securities markets for four years.

A Sebi probe found that Ally Multitrade was running 'collective investment schemes (CIS)' without obtaining registration from the regulator. The company was collecting money from public at large in the name selling  plots under its scheme.

Sebi said the company had mobilised over Rs2.33 crore from people between 2012 and 2014. However, the firm claimed it has refunded over Rs28 lakh to investors.

The sebi order directs the company and its directors Chetan Yashwant Thakur, Vijay Dattaram Chavan and Suryakant Sambu Bhosle to abstain from collecting any money from the investors or from launching or carrying out any collective investment schemes, including the scheme which has been identified as a CIS in the order.

The parties have been asked to wind up the existing CIS and refund the money collected by the said company under the schemes with returns which are due to its investors as per the terms of offer within a period of three months from the date of the order

The directors have been asked not to dispose of or alienate any of the assets of Ally Multi-Trade India Private Limited except for the purpose of making refunds to its investors.

Sebi has sought full details of all inventory and assets and properties and details of all their bank accounts, demat accounts and holdings of shares/securities, if held in physical form.

The order restrains the directors from accessing the securities market and prohibits them from buying, selling or otherwise dealing in securities market for a period of four years.

In case the company fails to comply with the order, Sebi would make a reference to state government/local police to register a civil/criminal case against Ally Multitrade India, it promoters and directors, for offences of fraud, cheating, breach of trust and misappropriation of public funds.

In addition, the regulator would make a reference to the ministry of corporate affairs to initiate the process of winding up of the company.

Besides, Sebi would initiate attachment and recovery proceedings against the firm.