NEW DELHI: The capital market regulator, Securities and Exchange Board of India (Sebi), has imposed a penalty of Rs 10 crore each on Malvinder and Shivinder Singh, former promoters of Religare Enterprises, after they were found involved in the diversion of loans from group NBFC companies -- Religare Finvest (RFL) and Religare Enterprises (REL).
The market regulator has also restrained the two brothers from accessing the securities market and prohibited them from buying, selling or otherwise dealing in securities, directly or indirectly, or being associated with the securities market, for a period of three years.
Sebi has also imposed a penalty of Rs 5 crore each on two former officials of Religare Enterprises, and a clutch of other related entities of the Singh brothers. All the culprits have been asked to pay the penalty within 45 days of the order.
The two brothers were found involved diversion of funds to the tune of Rs.2315 Crore from REL/RFL for their own benefit. The said diversions were done through several transactions spanning over 7 years from 2011 to 2018.
In one particular case, an amount of Rs. 1544.53 crores out of Rs. 2347.20 crores (outstanding principal as on May 31, 2018) as granted by RFL under its commercial loan book to various entities, were ultimately diverted through layers of entities for the benefit of Malvinder and Shivinder Singh.