CBI says Roopalben and friends made Rs32 crore from the IPO scam

23 February 2006

Roopalben Panchal and associates including a private company called Sugandh Estates cornered the shares of IDFC and Yes Bank by making thousands of applications under the retail category. They opened thousands of bank accounts and demat accounts using false identities with the connivance of bank employees and employees of a depository participant.

It was disclosed earlier by the SEBI that the group cornered more than 10 lakh shares of Yes Bank and more than 1 crore shares of IDFC. These shares were sold off the in the secondary market for a handsome profit, immediately after listing.

SEBI handed over the case to the CBI for further investigation. The agency conducted raids at 27 different locations in Ahmedabad, Mumbai and Delhi yesterday. Roopalben Panchal and her husband have been arrested and Rs1 crore in cash have been recovered.

CBI has also arrested some stock brokers based in Ahmedabad and some officials of the banks mentioned by SEBI in the scam. Those who have been arrested would be produced before a court in Ahmedabad today.