Videocon case: SEBI orders attachment of Venugopal Dhoot’s bank, demat accounts, electroparts

Capital markets regulator Sebi has ordered the attachment of bank accounts and share and mutual fund holdings of Venugopal Dhoot and Videocon Industries’ promoter entity Electroparts (India) for about Rs. 68.5 lakhs outstanding due can be recovered. Earlier, the regulator had on September 30 sent a notice to Videocon Industries’ promoter entity Electroparts (India) Pvt Ltd and its Chief Executive Officer (CEO) Venugopal Dhoot and asked them to pay dues within 15 days in a case of insider trading activities. Shares of Videocon Industries.

The attachment notice came after Dhoot and Electroparts (India) failed to pay the fine imposed on them.

In two attachment orders passed on Friday, the market watchdog ordered attachment of bank, demat accounts and mutual fund portfolios of Venugopal Dhoot and Electroparts (India) to recover dues.

As per the notice, Dhoot and Electroparts (India) has Rs. 68.52 lakhs was outstanding, including interest and recovery charges.

According to the notice, Sebi said defaulters may dispose of bank accounts and securities in demat accounts or mutual fund portfolios and “recovery of dues under the certificate, as a result, will be delayed or blocked”.

Accordingly, SEBI asked all banks, depositories and mutual funds not to allow any debit from the account.

SEBI banned Dhoot and two promoter entities – Electroparts (India) Pvt Ltd and Videocon Realty & A fine of 25 lakhs was imposed on Infrastructures Limited.

Electroparts (India) formerly known as Shree Dhoot Trading & Agencies. Violation of insider trading rules occurred in 2017.

Sebi found that Videocon Realty and Infrastructures, Electroparts (India) and Dhoot conducted market transactions despite being in possession of unpublished price sensitive information (UPSI) as insiders.

The investigation into Videocon’s scrip was conducted in April-September 2017.

Information regarding the classification of Videocon’s loan account as NPA by Dena Bank was likely to affect the share price of Videocon Industries and was treated as UPSI.

The period of UPSI was from March 1, 2017 to May 9, 2017.

During this period the two promoter entities either pledged their shares or transferred their shares of Videocon Industries to other entities.

Authorized Representative Venugopal Dhoot was an insider and traded on behalf of two promoter companies who were also insiders during the UPSI period.