Sebi bans GV Films, 5 others from securities markets for GDR manipulation
According to the order, Raghuraman was a whole-time director in the company, while Gopalan, Ganesh and Venkatramani were non executive directors and Subramonian was president-corporate affairs of the firm at the time of the violation.
Sebi had conducted an investigation in issuance of GDRs by GV Films and observed that the firm had issued 6.4 million GDRs for USD 40 million on April 27, 2007.
All the 6.4 million GDRs were subscribed by only one entity, Whiteview Trading Corporation, the regulator observed.
The subscription amount for GDRs was paid by Whiteview after securing a loan from bank Banco Efisa S.A.
However, GV Films had pledged the GDR proceeds to Banco bank against the loan given to Whiteview for subscribing GDRs, Sebi said.
"The GDR issue would not have been subscribed if GV had not given such a security against the loan taken by Whiteview," the regulator noted.
Sebi further noted that by entering into such an arrangement, the entities led the investors in India to believe that the issuer cRead More – Source