Sebi clamps down dairy scheme
Sebi made its move today to prevent an investment scheme involving public funds collection that were used to purchase cattle. This scheme was used by HBN Dairies and Allied Ltd.
The company allegedly sold the cattle for huge returns from the sale of ghee.
Ghee, a popular cooking product in India, is clarified butter created from the milk of water buffalos and cows.
Sebi asked HBN Dairies and Allied Ltd. to return IND1,100 crore to its investors. As part of the punishment, the company was barred from disposal of its assets which currently amount to IND1,000 crore. The assets may only be disposed for the purposes of cleaning up its schemes or refunding the investor money to investors.
The order is effective immediately, said Sebi. Furthermore, nine of its executives are prohibited from soliciting any amount of money from the company's investors or customers. The order also stipulated that the directors are barred from any money collection schemes.