1.

Mr. Kulandaivel was the Chairman of Thangam Bank. The bank was earning good profits. Shareholders were happy as the bank was paying regular dividends. The market price of their share was also steadily rising. The bank was about to announce taking over the ‘Trinity Bank’. Mr. Kulandaivel knew that the share price of Thangam Bank would rise on this announcement. Being a part of the bank, he was not allowed to buy shares of the bank. He called one of the his rich friends Mr. Chandrasekaran and asked him to invest ? 5 crores in shares of his bank promising him the capital gains.As expected, the share prices went up by 40% and the market price of Chandrasekaran’s shares was now tl crores. He earned a profit of ?2 crores. He gave ?1 crore to Mr. Kulandaivel and kept ? crore with himself. On regular inspection and by conducting enquires of the brokers involved, the Securities and Exchange Board of India (SEBI) was able to detect this irregularity. The SEBI imposed a heavy penalty on Mr. Kulandaivel. By quoting the lines from the above paragraph, identify and state any two functions that were performed by SEBI in the above case.

Answer»

Functions performed by SEBI in this case:

1. The market price of their share were informed and controlled by SEBI. 

2. On regular inspection and conducting enquiries, Exchange Board of India was able to detect this irregularity. The SEBI imposed a heavy penalty on Mr. Kulandaivel.



Discussion

No Comment Found