SEBI bars Pancard Clubs, directors from raising public money

Mumbai: Pulling the plug on illegal mobilisation of funds worth Rs 3,100 crore by Pancard Clubs, SEBI on Thursday barred the company and its directors from collecting any fresh money from public as well as launching any new scheme.

The company has collected around Rs 3,100 from nearly 25 lakh investors, by asking them to invest in its holiday scheme with a promise of assured return on investment.

"...Pancard Clubs, is engaged in the mobilization of funds from public under its holiday plans, which is in the nature of 'collective investment scheme'..." the Securities and Exchange Board of India (SEBI) noted.
The Mumbai-based company was found to have running a CIS under its holiday plans without obtaining a certificate of registration from SEBI.

Under its 'divine holiday' scheme, if any person invests an amount of Rs 3,600 (i.E. 4 room nights) then after 66 months, the investor gets a return of Rs 4,800 for surrendering the four room nights offer. Apart from this, the company was running seven other similar schemes.

Consequently, SEBI directed the company and its directors --Sudhir Shankar Moravekar, Shobha Ratnakar Barde, Usha Arun Tari, Manish Kalidas Gandhi, Chandrasen Ganpatro Bhise and Ramachandran Ramakrishnan--"not to collect any fresh money from investors under its existing scheme and "not to launch any new schemes or plans or float any new companies to raise fresh money".

The entities have also been ordered to immediately submit the full inventory of the assets owned by the company out of the amounts collected from the investors.

Besides, the company and its promoters or directors have been asked not to dispose of any of the properties or alienate the assets of the existing scheme as well as not to divert any funds mobilised from the public.

They would have to furnish all the information sought by SEBI with regard to scheme-wise list of investors and their contact details and along with the details of amount mobilised and refunded till date within 15 days.

The directions would take effect immediately and would be in force until further orders in this regard.
According to SEBI, the company raised a sum of Rs 3,096.31 crore from a total number of 24,86,650 investors under its eight Holiday Plans.

The directives come after SEBI received complaints against Pancard Clubs alleging fraudulent fund mobilisation across the country.