In India Financial Scams have strike economies all over the globe. These scams can effortlessly degrade the prestige of any nation. It generally refers to the illegal practices done by a person through taking money away from the others or any other assets. There are a lot of cases in India of Financial Scams.
In India these types of Financial Scams are executed by the individuals who funds in the stock exchange and are included in any different type of Investments.These individuals use unconventional thinking and engage in illegal practices like scams.
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Allow yourself to read this article to know more about some of the top Financial Scams in India.
1.THE SATYAM COMPUTERS SCAM
In 2006- 2008 this is assumed as one of the top most financial scams held in India .On 7 January, 2009 this scam occurred, the founder-chairman of Satyam Computers Ramalinga Raju admitted and publicized in his balance sheet about 7000 rupees crore accounting fraud.
He falsified the books by a total of Rs. 12,318 crore. Internal audit reports for the company found 7, 561 false bills. In April 2015, Ramalinga and the other 10 members were found guilty. The government ordered an auction to sell the company when the fraud was discovered.
2. KETAN PAREKH AND THE STOCK MARKET SCAM OF 2001
As a chartered accountant by profession, Ketan Parekh was on the lookout for stocks with little market capitalization and minimal liquidity. He would then finance money in these shares and begin fictional trading within the company’s Thenetwork.
What did Ketan Parekh do?
He buys the stakes from unknown market capitalization corporations and charges up the costs through trading with different traders.
He used a pump and dump strategy. He supervised money from banks, institutional investors and promoters to seize up the costs of shares. He received orders and got loans. When the market hit Ketan Parekh suffered losses alongside the banks from which he borrowed loans.For issuing pay orders totalling 137 crores, the bank of India filed a complaint against Ketan Parekh.He was put on trial and arrested for executing insider trading, manipulation stock price, defrauding institutional investors.
3. HARSHAD MEHTA AND THE STOCK MARKET SCAM
In the history of India this also came in one of the largest financial scams. Harshad Mehta began his broker work after initiating the job of broker in BSE. He utilized the Ready forward contract, which served as a bank’s short-term instrument. Generally, Brokers serve as the middleman in ready-forward trades.
In order to make money, Harshad Mehta found the RF deal’s vulnerabilities and used them. He made a lot of money by utilizing the RF deal as a link in a chain.
He manipulated the shares to seize them to a top level and developed false recipes for banks.When the market began falling down, he started incurring losses and was incapable of repaying the cash to the banks.The fraud of Harshad Mehta was publicized in The Times of India on 23 April 1992. After that Harshad Mehta was arrested by the CBI.
4. NIRAV MODI, THE PUNJAB NATIONAL BANK SCAM
The major suspect in this scam was Nirav Modi, a high-end diamond jewelry designer, together with some of his relatives and staff of Punjab National Bank.
10,000 crore rupees worth of fraudulent LOUs (Letter of Undertaking) were issued by the bank. Utilizing fraudulent LOUs, bankers imported jewel for one year and disregarded the policies of RBI. PNB employees misused the SWIFT option to convey messages to Axis bank and Allahabad Bank on money requirements.
5. SARADHA SCAM
In 2003 and 2011 this scam was.Investors from both the elite and middle classes were affected by this.
To raise money for the company, the Chairman of Saradha Company issued bonds and debentures to raise funds for the company.
Sudipta Sen invited the agents to attract investors who will fund in these securities, for which the agents will get a commission, however SEBI did not provide approval.
He raised Rs.4,000 crore from this. SEBI found out some mishappening in Saradha Company and informed the West Bengal government. To confuse SEBI, Sarah created a web of companies within it. Later that Ponzi strategy tumbled and people were blamed, containing several politicians. And after that she was arrested.
6. 2G SPECTRUM SCAM
This scam can be known as the mother of all scams.The former telecom minister was forced to leave as a consequence of this fraud, and the telecom ministry then granted private operators access to wireless radio spectrum and licenses.
These were assigned at extremely low costs and led to the outcome of huge losses.
7. COMMONWEALTH GAME SCAM
Commonwealth games- the largely promoted games somehow became a target for scams by the investors. Suresh Kalmadi, the retired chairman of the commonwealth games commited this fraud. This fraud featured 35,000 crores of rupees.
8. TELGI SCAM
Abdul Karim Telgi- A scam artist with his mastered skill of fraud published copied stamp papers. Many Government Departments participated in this fraud and through this makes the nation feel disgraced with many corrupt activities.
9. IPL SCAM
The beloved and most awaited event in India, the Indian premier League somehow engaged in unlawful or illegal practices.It was alleged that politicians and others were using fake investor identities to launder black money.
10. VIJAY MALLYA
In history, he was also called the “king of good times” but he ruined his reputation by supposedly owing Rs. 9000 crore for Kingfisher Airlines as a loan from banks. The Fugitive Economic Offenders Act has lately given a name to him a criminal economic fugitive.
Several financial frauds in India questioned the nation’s reputation and image. These unlawful actions are a reflection on the nation as a whole.
FAQs
1. Which major financial scam happened in India?
Harshad Mehta scam is assumed to be one the prominent financial scams in the past of India.
2. What are the recent financial scams in India?
The newest financial scams like 2G SPECTRUM and commonwealth games scams happened in India.
3. Name of the top 10 financial scams that take place in India?
The top ten financial scams are –
● The Satyam computer scam
● IPL SCAM
● Punjab National bank scam
● Ketan Parekh scam
● Nirav Modi scam
● Saradha scam
● Vijay Mallya scam
● 2G spectrum scam
● Harshad Mehta Scam
● Hawala scam
4. Who is the wealthiest scammer in the world?
A Nigerian advance-fee scam artist named as the Owelle of Abunuga, Emmanuel Nwude Odinigwe is a retired director of the Union Bank of Nigeria is the wealthiest scammer in the world.
5. Total financial scams that are noticed in India ?
Overall, India noticed 83,638 cases of banking scam concerning Rs 1.38 lakh crore, but they got back only Rs 1,031.31 crore.
