Search the Internet          Tips  Sites: Finance, Investment

Sebi probing Cyberspace price manipulation

BS Markets Bureau

Sebi has started investigating into the alleged price manipulation in the Cyberspace counter.

We have called for all the transaction details in the scrip from all the stock exchanges, L K Singhvi, senior executive director, Sebi, said. Meanwhile, both the National Stock Exchange and the Bombay Stock Exchange have also started looking into the matter.

Cyberspace, formerly known as Century Finance International, is a Bombay-based infotech company promoted by Arvind Johri. The promoter allegedly ramped up the share price to a whopping Rs 1,480 through a brokerage firm, called Century Consultants, also owned by him.

According to marketmen, Century Consultants used to borrow from banks and private sources by pledging Cyberspace shares. It then used the funds for ramping up the stock's prices. This unofficial borrowing was often at interest rates as high as four per cent per month.

Now that the scrip has crashed, Johri is believed to be away in Australia. His office in Bombay continues to remain shut. The counter faces a default of approximately around Rs 350 million and the entire extent of the rigging and fraud is still uncertain.

Meanwhile, Central Depository Service (CDSL) has temporarily suspended the depository participant of Century Consultants. CDS has also deactivated the terminals of Century Consultants.

Further, CDSL has made contingency pool arrangements at its premises, 28 floor, P J Towers, Bombay, in order to enable the investors to give instructions in respect of their demat account. CDS has also appointed a reputed firm of auditors to carry out concurrent audit of all instructions being processed.

Powered by

ALSO READ:
The Rediff-Business Standard Special
The Budget 2001-2002 Special
Money
Business News

Tell us what you think of this report