Sebi imposes Rs 1.15 cr fine on Syncom Healthcare, officials for flouting market norms

Markets regulator Sebi on Friday imposed a total penalty of Rs 1.150000000 on Syncom Healthcare Limited and its officials for violation of various markets norms while manipulating issuance of global depository receipts (GDR).During the investigation between August 2010 and September 2010, Sebi noted that the firm had issued 4.5 million GDR amounting to approximately Rs 960000000 on September 3, 2010.The regulator found that Vintage FZE was the only entity to have subscribed to 4.5 million GDR and the subscription amount was paid by obtaining loan from European American Investment Bank (EURAM).The investigation revealed that the loan paid by Vintage was secured by pledge agreement between Syncom and EURAM Bank Further, "the arrangement of loan and pledge agreement which resulted in subscription of GDR issue of the company, was not disclosed to the exchanges and company reported misleading news to the stock exchanges which contained information in a distorted manner and might have influenced decision of investors," Sebi said.Thereby, the scheme of issuance of GDRs was fraudulent.Also, Syncom provided a false list of GDR subscribers.The firm and its officials have violated provisions of listing agreement and failed to comply with Securities Contract Regulation Act and Prohibition of Fraudulent and Unfair Trade Practices norms, Sebi said.Accordingly, Sebi levied a fine of Rs 2500000 on Syncom Healthcare and Rs 1500000 each on its officials -- Ajay S Bankda, Jyoti Bankda, Jagadish Prasad Bagaria, Bharat Kumar Doshi, Govind Das Pasari and Avichal Kasliwal.