SEBI bans suspended cos from raising fresh funds
Updated: Jul 21, 2015 03:30:58pm
Mumbai, Jul 21 (KNN) The Securities and Exchange Board of India (SEBI) on Monday barred suspended companies and its promoters and directors from raising money through public issue of securities till their suspension is revoked by the concerned recognised stock exchange or securities of such company are delisted from the stock exchange.
Recently SEBI banned 239 individuals and entities from accessing the securities market for misusing the small and medium enterprises (SME) trading platform of exchanges to launder money and to evade taxes.
“A suspended company, its holding and/or subsidiary, its promoters and directors shall not, issue prospectus, any offer document, or advertisement soliciting money from the public for the issue of securities, directly or indirectly; till the suspension is revoked by the concerned recognised stock exchange or securities of such company are delisted in accordance with the applicable delisting requirements,” said the regulator in a press statement.
It also suspended the shares of listed companies from trading by stock exchanges for not complying with listing rules.
According to SEBI, it has been noticed that several listed companies continuously fail to comply with listing conditions stipulated under the equity listing agreement and consequently trading in their shares is suspended by the concerned recognised stock exchange.
“While the non-promoter shareholders of such companies remain in disadvantageous position on account of information asymmetry, their promoters/directors, who are responsible for such defaults, can use the undisclosed information about the company and dispose of their shareholding in the company leaving the gullible investors in lurch,” it said. (KNN Bureau)
Recently SEBI banned 239 individuals and entities from accessing the securities market for misusing the small and medium enterprises (SME) trading platform of exchanges to launder money and to evade taxes.
“A suspended company, its holding and/or subsidiary, its promoters and directors shall not, issue prospectus, any offer document, or advertisement soliciting money from the public for the issue of securities, directly or indirectly; till the suspension is revoked by the concerned recognised stock exchange or securities of such company are delisted in accordance with the applicable delisting requirements,” said the regulator in a press statement.
It also suspended the shares of listed companies from trading by stock exchanges for not complying with listing rules.
According to SEBI, it has been noticed that several listed companies continuously fail to comply with listing conditions stipulated under the equity listing agreement and consequently trading in their shares is suspended by the concerned recognised stock exchange.
“While the non-promoter shareholders of such companies remain in disadvantageous position on account of information asymmetry, their promoters/directors, who are responsible for such defaults, can use the undisclosed information about the company and dispose of their shareholding in the company leaving the gullible investors in lurch,” it said. (KNN Bureau)
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