SEBI fines Brightcom Group, promoters, other entities Rs 34 crore, issues ban from securities market

The regulator has also banned few noticees from associating with any listed entity.

The market regulator has imposed a fine of Rs 34 crore on Brightcom Group (BGL) and four other noticees, and has banned the entities from the securities market for one to five years.

The regulator fined Suresh Kumar Reddy ((Chairman and Managing Director and Promoter) and Vijay Kancharia (Whole-time Director, Promoter) Rs 15 crore each; Y. Srinivasa Rao (former CFO) Rs 2 crore, and BGL and Yerradoddi Ramesh Reddy (former Independent Director, former Executive Director, former CFO) Rs 1 crore each.

In a final order issued on February 6, the Securities and Exchange Board of India (SEBI) has also banned promoters Suresh Kumar Reddy  and Vijay Kancharia for five years each, and BGL, Yerradoddi Ramesh Reddy and Y. Srinivasa Rao for one year each, from accessing the securities market. The order also restrained the promoters, directors and the former senior executives from being associated with the securities market, in any manner whatsoever, including as a director or Key Managerial Personnel in a listed company or an intermediary registered with SEBI or a public company which intends to raise money from public in the securities market for varying periods.

The final order comes after a series of orders passed in the matter from April 13, 2023, when the Interim Order Cum Showcause Notice (SCN) was issued.

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In the order, SEBI's Whole-time Member Ananth Narayan noted, " Vide the Interim Order cum SCN, certain directions were issued to all the Noticees. In this regard, I note that BGL has not complied with any of the directions except for directions at para 177(c), (d) and (g). Also, while BGL has claimed that it had complied with the following direction, I find that BGL has failed to do so for the reasons recorded in the Table below."