Sebi orders Disc Assets to repay CIS investors within three months

Markets regulator Sebi on Wednesday ordered Disc Assets India and its directors to refund in three months the money collected from investors through unauthorised schemes. The company and its directors have also been barred from the capital market for four years.

The Securities and Exchange Board of India (Sebi) found that the company solicited funds from investors under its schemes with a promise of return. The firm was running Collective Investment Schemes (CIS) without obtaining regulatory approvals.

Disc Assets India admitted that it has collected Rs 1,137 crore between 2006 and 2015. In an order passed on Wednesday, Sebi asked the company and its directors to "wind up the existing CIS and refund the money collected by the said company under the schemes with returns which are due to its investors...within a period of three months."  Thereafter, the firm has to submit a winding up and repayment report within 15 days, including the trail of funds claimed to be refunded, bank account statements indicating repayment to investors, among others. 

In addition, they have been barred from selling any assets of the company, except for the purpose of making refunds to its investors. 

In case they fail to comply with the order, Sebi said Disc Assets and its directors will continue to be barred from the securities market, even after the completion of four years of restrictions imposed on them "till all the CIS are wound up and all the money mobilised through such schemes are refunded to its investors with returns which are due to them." 

Besides, it would make a reference to State Government/ Local Police and register a civil/criminal case against Disc Assets and would make a reference to the Ministry of Corporate Affairs to initiate the process of winding up of the firm.