MUMBAI: Pulling the plug on illicit real estate investment schemes, markets regulator Sebi has restricted two firms -- Vee Realties India Ltd and Arise Bhoomi Developers as well as their respective directors from raising funds from investors with immediate effect.
The Securities and Exchange Board of India (Sebi) has prima facie found that money pooling activity by the companies was in the nature of "collective investment scheme (CIS)" and was being run without requisite approval from the regulator.
Noting that the two firms and their directors had to be prevented from illegally raising funds from public, Sebi said it had "no other alternative but to take recourse to an interim order" against the companies.
Accordingly, in two separate interim orders today, the regulator has asked the firms and their directors "not to collect any fresh money from investors under its existing schemes" as well as "not to launch any new schemes or plans or float any new companies to raise fresh moneys".
They also have "to immediately submit the full inventory of the assets including land obtained through money raised".
Besides, the company and its directors have been barred from disposing of or alienate any of the properties or assets owned or acquired through the money raised.
Further, they cannot "divert any fund raised from public at large which are kept in bank account(s)and/or in the custody of Vee Realties," Sebi said.
The regulator has also asked the companies and its directors to file their reply in the matter within 21 days from the date of receipt of the interim orders.
As per details provided by the company it has raised Rs 22.41 crore from as many as 1,65,291 investors as on May 24, 2014 under its various schemes related to plots of land.
Details relating to fund mobilisation by Arise Bhoomi was not provided in the interim order.
Sebi had initiated a probe against Vee Realties and Arise Bhoomi on receipt of complaints that the companies were raising money without authorisation.
In the case of Vee Realities, Sebi had got information from office of collector, Rajnandgaon (CG), Chhattisgarh, earlier in March, this year.
The orders have been passed against 12 directors of Vee Realities and three directors of Arise Bhoomi.