The board has concluded that the stockbroker, in collaboration with Bhrikuti Stock Broking Company, may have artificially inflated the price of shares, which may constitute an offense under the Securities Act.
We use Google Cloud Translation Services. Google requires we provide the following disclaimer relating to use of this service:
This service may contain translations powered by Google. Google disclaims all warranties related to the translations, expressed or implied, including any warranties of accuracy, reliability, and any implied warranties of merchantability, fitness for a particular purpose, and noninfringement.
The report submitted by the Nepal Securities Board to the investigative agency has pointed out that controversial businessman Deepak Bhatta, along with Subi Agrawal, Raj Bahadur Shah and Rishiraj Mor, were involved in borrowed share trading. The board has prepared the investigation report based on a letter from the Money Laundering Investigation Department. The report details the share trading in the business partnership between Bhatta and the Shankar Group. The report also reveals that along with Bhatta, Subi, wife of Shankar Group Vice Chairman Sulabh Agrawal, Shah, Managing Director of Jawalakhel Group of Industries, and another businessman Mor also purchased shares on borrowed money from broker number 55 Bhrikuti Securities against the law and were being liquidated. The report was made public by ‘Kathmandupati Online’ on Tuesday.
‘It is seen that Subi Agrawal, Raj Bahadur Shah and Rishiraj Mor, like Deepak Bhatta, obtained the share trading limit without paying the advance amount, did not pay all the amount of the share trading and received the shares in their accounts without paying the amount,’ the report says, ‘This action seems to have helped increase the price of the shares they purchased. It also seems to have been a deception of investors and the stock market.’ The board has concluded that they planned and acted in collaboration with the stock broker Bhrikuti Stock Broking Company to deceive investors and artificially increase the price of the shares, and this may have been an offense under the Securities Act. Deepak Bhatta-Sulabh Agrawal: Together during the Corona period, disruption in share trading worth Rs 373 crore
Similarly, the Securities and Exchange Board of Nepal has also found that the trading management system (TMS) of Bhatt, Sulabh Agarwal, Himalayan Reinsurance, Himalayan Securities Banker, Himalayan Capserve, HLI Large Cap Fund, Nepal Micro Insurance, Guardian Micro Life Insurance, Crest Micro Life Insurance, Liberty Myco Life Insurance and Protective Micro Insurance is operated by the same person. Deepak Bhatt has also admitted this matter in his statement to the Money Laundering Investigation Department. Bhatt has stated that he gave the TMS to the broker and Sulabh Agarwal took the TMS 'login password' from the broker and traded from his own office, according to a department source.
‘It appears that Subi Agrawal and Rishiraj Mor, while trading shares of Guardian Micro Life Insurance, a listed corporate body, obtained the transaction limit without paying the advance amount, did not pay the entire amount of the share transaction and received the shares in their accounts without paying the amount,’ the report states. ‘This action seems to have helped increase the price of the shares purchased by them and deceived investors and the stock market.’ Therefore, the board has stated that they did this act in collaboration with the stock broker Bhrikuti Stock Broking Company and which will be held guilty under the existing law.
Thus, Deepak Bhatt and Sandeep Chachan, the person responsible as the executive head of the stock broker Bhrikuti Stock Broking Company, have committed an offense under Sub-section (1) of Section 96 and Section 98 of the Securities Act, 2063, and the board has also recommended for further investigation.
The board has found that Himalayan Reinsurance Company, Himalayan Capserve, Nepal Micro Insurance Company, Himalayan Securities Banker, HLI Large Cap Fund, Rohit Gupta and Shekhar Golchha were used as collaborators in this work.
‘It seems that Subi Agrawal, Himalayan Life Insurance Ltd., Rishiraj Mor and Raj Bahadur Shah are also involved in the act of increasing the share price of Nepal Reinsurance. It seems appropriate to send the police headquarters to investigate this crime as per the Securities Act,’ the report says.
Similarly, the board has also found that Bhrikuti Stock Broking Company (Broker No. 55) purchased shares on credit in the names of various individuals mentioned and did not pay the money sold by various individuals and organizations to settle those transactions. In which it appears that a large amount of transactions of businessman Bhatt and various individuals and companies associated with him are still to be cleared .
It has been seen that Subi Agrawal, Raj Bahadur Shah and Rishiraj Mor, like Deepak Bhatt, have received the share trading limit without paying the advance money, have not paid all the amount of the share trading and have received the shares in their accounts without paying the amount: The Securities and Exchange Board of Nepal (SEB) report
According to the board, among the investors who have yet to collect money from Bhrikuti Stock Brokers, businessman Bhatt has the largest amount of Rs 2.73 billion 3.315 billion in the name of the investor. The broker has yet to collect Rs 897 million from Raj Bahadur Shah, Rs 628.9 million from Subi Agrawal and Rs 231 million from Rishiraj Mor. In addition, the board's report states that Rs 2.2 million is still to be collected in the name of Himalaya Investment Banker Limited.
On the other hand, the broker has yet to pay a large amount to various large institutions and reputable businessmen . Of which, the highest amount of Rs 2.733 billion is to be paid to Himalayan Re-Insurance Limited. Other businessmen who are yet to be paid by the broker include Rohit Gupta and Shekhar Golchha. The broker has yet to pay a total of Rs 1.5 billion to both Gupta and Golchha at the rate of Rs 525 million each.
Similarly, the report mentions that on the institutional side, Rs 370 million is yet to be paid to Himalayan Capserve, Rs 251.4 million to HLI Large Cap Fund, Rs 221.9 million to Himalayan Securities Banker and Rs 161.7 million 52 thousand 873 88 paisa to Nepal Micro Insurance Company. The Securities Act, 2063 defines such loan transactions and non-payment of amounts after transactions as ‘false transactions’.
According to the provisions of the Act, a person who commits such an offense can be fined from 50 thousand rupees to 1 lakh 50 thousand rupees or imprisoned for up to one year, or both. If someone has suffered loss or damage due to such a transaction, the Act has a legal provision to pay the amount (indemnity) for such loss or damage and also provide compensation.
