IPO scam: Jhaveri settles case with SEBI

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SEBI has agreed to dispose of pending proceedings against Mr Gautam Jhaveri for his involvement in the IPO scam of 2003-04, following settlement of the case through a consent order.

Mr Zhaveri who applied for the consent order, paid Rs 2.7 crore towards settlement, including a disgorgement amount of Rs 2.36 crore, settlement charges of Rs 23.6 lakh, compounding charges of Rs 9 lakh and legal charges of Rs 1 lakh.

The applicant (Zhaveri) had been proceeded against for irregular dealings in shares issued through IPOs, and for cornering shares meant for retail investors, making unlawful profits from the shares upon their listing.

SEBI had banned the applicant from dealing in the securities market; initiated adjudication proceedings against him, prosecution proceedings in the ACMM court in Mumbai under the Companies Act; and a protest petition before the CBI court for non-filing of chargesheet against the applicant.

SEBI's consent order disposes of all these pending proceedings. SEBI will file an application for withdrawal of its protest application at the CBI special court, and shall not oppose compounding of prosecution in the ACMM court, the regulator said in its consent order.

SEBI said it would also drop proceedings against Pratik Stock Vision Pvt Ltd in the matter of carry forward transactions in the shares of Global Tele-systems Ltd in 2000-01. The applicant offered to settle the case, offering Rs 1.25 lakh towards settlement charges, reports The Hindu Business Line.