ICICI bank files fraud case against Karvy Stock Broking

Karvy Stock Broking Promoter C Parthasarathy (C. Parthasarathy) A case has been filed against and others alleging fraud of Rs 563 crore with ICICI Bank. According to the press release issued by the police on Tuesday night, this case has been registered against the accused under sections 406 (criminal breach of trust) and 420, r/w 34 (cheating) of the IPC.

Police say that Karvy had transferred the money raised by mortgaging six of his bankers to his personal bank accounts. This fund was not deposited in the accounts of the clients of the stockbroker. Karvy has violated SEBI guidelines by doing so. This release further states that all the pledges on the securities were closed without permission and these securities were transferred to the end clients of KSBL.

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The matter has been transferred to the Economic Offenses Wing of Cyberabad for investigation. A special team has also been formed to investigate the matter.

Let us inform that C Parthasarathy, Chairman and Managing Director of Karvy Stock Broking was arrested by Hyderabad Police on Thursday i.e. 19th August. Police said they were accused of fraud and misappropriation of clients’ funds. IndusInd Bank, while filing a complaint against this financial services company, said that the company has defaulted by taking a loan of 137 crores from it. Avinash Mohanty, Joint Commissioner of Police, Hyderabad Police said that HDFC Bank has also filed two cases on the allegation of fraud of about 350 crores.

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