Reliance Infrastructure and Reliance Natural Resources fell by 5.66% to 7.31% at 11:21 IST on BSE on reports the government is seeking details of an alleged misuse of accounts of these two Anil Dhirubhai Ambani Group firms by UBS employees.
Shares of Reliance Infrastructure, erstwhile Reliance Energy, plunged 7.31% to Rs 591. Reliance Natural Resources (RNRL) dropped 5.66% at Rs 54.25. Reliance Infrastructure had lost 2.53% at Rs 636.55 and RNRL had declined 2.21% at Rs 57.45 on Tuesday, 16 December 2008, when the reports about the fraud hit the market before trading hours.
The Enforcement Directorate (ED), which is investigating possible violations of the Foreign Exchange Management Act (Fema) by some former UBS employees, has written to the UK’s Financial Services Authority, seeking details of the alleged misuse of accounts of the two Anil Dhirubhai Ambani Group (ADAG) firms Reliance Energy and RNRL.
The agency is probing if the executives, who have been sacked by the Swiss bank, had illegally obtained overdrafts against cash collateral security held in the account and transferred them into the accounts of a few diamond merchants based in India and Belgium.
The funds were then allegedly pumped into the stock market through a fund manager – Pluri Emerging Companies PCC Cell E Emerging Markets Growth Fund — using the participatory note route. Funds are also suspected to have been transferred to Brockway Inc.
The Indian agency is also probing if there was any link between the two ADAG companies, Pluri, Brockway and the diamond merchants. Reliance Energy and RNRL, which had raised funds through foreign currency convertible bonds (FCCBs) and external commercial borrowings (ECBs), had kept the funds in accounts maintained with UBS, London, reports suggest
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