Sebi Imposes Three-Year Securities Ban On Liquor Baron Vijay Mallya
The Securities and Exchange Board of India (Sebi) has imposed a three-year ban on Vijay Mallya, preventing him from accessing the securities markets. The once prominent liquor baron is prohibited from buying, selling, or otherwise dealing in securities, directly or indirectly. Additionally, he is barred from associating with any listed or proposed-to-be-listed company.This ban includes freezing Mallya's existing securities holdings, including mutual fund units, according to Sebi. The decision stems from an investigation into the routing of funds to the Indian securities market through overseas bank accounts with UBS AG.
The investigation was initiated suo-moto by Sebi following a communication from the Financial Services Authority, which hinted at the possibility of Mallya channeling funds to the Indian market. Preliminary findings revealed that Mallya used a sub-account, Matterhorn Ventures, a foreign institutional investor (FII), as an investment vehicle to indirectly trade in shares of his group companies in India, namely Herbertsons and United Spirits Limited (USL).Mallya reportedly routed funds by opening various beneficiary accounts with UBS and transferring these funds indirectly to the Indian securities market. He employed the FII route through several overseas registered entities, effectively concealing his investments' true identities.Sebi's investigation concluded that Mallya's actions abused the FII Regulations framework. He was found to have engaged in manipulative practices and deceptive artifices in dealing with the securities of his listed group companies in India. The order noted that Mallya indulged in fraudulent activities and unfair trade practices, violating securities laws.This ruling marks another chapter in the long-running saga of Vijay Mallya, who has faced multiple legal battles and accusations of financial irregularities.
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