BEWARE OF SAHARA

Close on the heels of ordering attachment of bank accounts, investments and all other assets of two Sahara group firms and their promoters, including group chief Subrata Roy, market watchdog Sebi today cautioned the investors and general public against transacting with these companies and persons. "Anyone transacting with them (Sahara India Real Estate Corp Ltd, Sahara Housing Investment Corp Ltd and their three promoters and directors) would be doing so at their own peril," the Securities and Exchange Board of India (Sebi) said. The regulator said that in furtherance to a Supreme Court order directing refund of investors' money collected by these Sahara firms, it has ordered "attachment of all moveable and immoveable properties, bank accounts and demat accounts of these two companies and that of its promoters and directors namely Subrata Roy Sahara, Vandana Bhargava, Ashok Roy Choudhary and Ravi Shankar Dubey". "Investors and general public are advised to exercise caution and take note of the said orders before transacting with the aforesaid entities/persons in any manner whatsoever," Sebi said in a public notice. On February 13, Sebi passed two separate orders, together running into 160 pages, directing attachment of properties and freezing of accounts. It was after the Supreme Court said that the regulator was free to freeze the accounts and attach properties if Sahara firms were not complying with the apex court's earlier orders of August 2012 towards refund of investors' money totalling over Rs 24,000 crore. The assets ordered to be attached included those related to the group's Aambey Valley resort town near Pune, other real estate assets in Delhi, Mumbai and at other places across the country, shares, mutual funds and various other investments. Passing the attachment orders, Sebi said that the two companies had raised Rs 6,380 crore and Rs 19,400 crore, respectively from bondholders and "various illegalities" were committed in raising of these funds. With regard to Subrata Roy and three other directors, namely Vandana Bhargava, Ravi Shanker Dubey and Ashok Roy Choudhary, Sebi ordered freezing of all bank and demat accounts of these four persons, as also attachment of all moveable and immoveable properties in their name with immediate effect. Subsequently, the Sahara Group claimed that the actions taken by Sebi were based on "old facts" and the orders for attaching assets of individuals is incorrect on part of the market regulator. It also said that it has already deposited with Sebi an amount of Rs 5,120 crore that was in excess of its total liability towards refund to investors.