Two cases have been registered against popular brokerage firm Karvy in CCS Hyderabad. According to reports, Karvy used the clients’ actions for his own purposes. Hyderabad CCS has registered fraud cases against Karvy for allegedly embezzling Rs 383 crore. Karvy took out loans from private banks and lawsuits were filed against the stock brokerage firm. Two banks separately filed suit against Karvy and alleged that the company took out loans by mortgaging the shares and was no longer repaying the loans.
HDFC and IndusInd Banks complained to the police and asked to take legal action against the company. The CCS police are investigating the case from all possible angles to find out the truth.
Karvy Stock Broking Ltd took out a loan of Rs 185 crore from IndusInd Bank in 2019 through securities and bank guarantees and defaulted on the loan. IndusInd Bank officials have filed a police complaint alleging misappropriation of nearly Rs 138 crore. The SEBI (Securities and Exchange Board of India) recently announced that Karvy took loans from banks based on the actions linked to investors and misused them.
HDFC Bank Deputy Vice President Srinivas Ayyagari had filed a complaint with CCS Police stating that the directors of Karvy Parthasarathy, Sivaramakrishna Mullapuri, Rajat Parthasarathy and Sushilkumar failed to pay the Rs 246 crore loan. He further added that in September 2019, Karvy took out a Rs. 350 crore loan by mortgaging the investors’ shares and the company failed to pay Rs. 208 million.