Sterling Biotech Directors barred
SEBI has banned the directors of Sterling biotech from accessing the securities market in a matter relating to fraudulent behaviour by the company. Furthermore, they have been stopped from holding any position as a director or as key personnel in any of the listed companies listed with SEBI during the restraint period.
The deterred order is between 3 years to 5 years. From September 1 to October 31, 2003, 3 was the investigation period the company showed the GDR issuance of 2.3 million amounting to 15.37 million on 1st October 2003
SEBI found out that the scheme of issuance of GDR was a fraud since the form had entered into an agreement with Banko Efisa Bank for a loan that was availed from another lender for the subscription of GDR.
This account charge agreement was not disclosed to any of the stock exchanges. SEBI said that in this scheme the company received GDR without paying the consideration for 80% of GDR, at the cost of shareholders and investors of the sterling company.
Sterling was in liquidation and Fresia was dissolved therefore the proceedings against both were disposed of.