SEBI bars DHFL promoters from accessing securities market

Markets regulator Securities and Exchange Board of India (SEBI) on September 22 issued an interim ex-parte order barring twelve promoters of Dewan Housing Finance Limited (DHFL) from accessing the securities market, citing violation of norms.

In the order, SEBI names the promoters of DHFL between April 1, 2006, and March 31, 2019, namely Kapil Wadhawan, Dheeraj Wadhawan, Rakesh Kumar Wadhawan, Sarang Wadhawan, Aruna Wadhawan, Malti Wadhawan, Anu S Wadhawan, Pooja D Wadhawan, Wadhawan Holding Pvt Ltd, Wadhawan Consolidated Holding Pvt Ltd, Wadhawan Retail Venture Pvt Ltd and Wadhawan Global Capital Ltd (formerly known as Wadhawan Housing Pvt Ltd).

The market regulator has also restrained the 12 promoters of the crisis-hit company from associating themselves as directors or promoters of any listed public company or any public firm that intends to raise money from the public or any intermediary registered with SEBI. It has given them a 21-day period from the date of receipt of the notice, to show cause as to why the said prohibitions should not be imposed against them.

Noting in its order that the violations are very grave in nature and the amount involved in the fraudulent transactions is of a very high magnitude, SEBI said the step to restrain the noticees has been taken to minimise the damage caused to the interests of the investors and to protect market integrity.

SEBI noted that DHFL had entered into certain fraudulent transactions, which were shown as bonafide transactions in its published financial statements as well as corporate announcements disseminated in the public domain. The promoters named in the notice have been accused of having been involved in these transactions and misleading investors by releasing false financial statements for over a decade.