Senior Citizens Defrauded by Sub-broker
A Bandra based couple has registered a complaint against two men for allegedly defrauding them of Rs50 lakh. The accused have been booked under Sections 420, 405 and 463 of the Indian Penal Code. 
 
Mount Mary Road resident - Hassanaly Dossani was introduced to the two brothers Bhaumik and Amit Gada in December of 2016. The former said he was an ex-banker running a firm with his brother that acted as the sub-broker for the Motilal Oswal financial group. He subsequently offered his services as an investment advisor.
 
Mr Dossani then visited their office in Ghatkopar to verify their claims. He met them a few times and finally decided to take up their offer on March 2017. He then opened a DEMAT account with Motilal Oswal Securities Ltd (MOSL) and transferred shares worth Rs40 lakh into the account. However, before the transfer, they had signed a contract with the brother’s firm, OSR Financial Services that prevented them from selling shares without prior consent from Mr Dossani and his wife.
 
Mr Dossani said he was given monthly statement of account on MOSL’s letterhead, which was duly stamped and signed. “Not being tech savvy, we never checked the real statement on emails, believing these copies to be authentic.
 
Besides, we were getting a regular flow of cash into our savings account which we were told were profits from these trades,” said the retired pharmaceutical professional.
 
In December 2018 the family wanted to liquidate a part of its position in the equity market due to a family emergency and instructed the Gada brothers to do the same. They kept evading the requests from Mr Dossani to liquidate his position and when they were finally confronted by him in January, they informed him that they had sold off shares worth Rs49 lakh without his knowledge or authority. 
 
It was then that the couple took notice and cross checked all the statements provided to them by the brothers over email. It is then that they realised that the physical copies were forged and numbers on them were manipulated by them.
 
This is not the first time that the Motilal Oswal Group has been accused of permitting unauthorized trading. In 2006, Wing Commander CR Mohan Raj VM [Retd] lost a significant part of his savings when the Motilal Oswal group sold his shares off without his instructions. 
 
The Wing Commander subsequently took the case to District Consumer Forum where the Motilal Oswal group produced a bogus power of attorney (POA) to sway the case. However, the Consumer Court ruled in favour of Mr Mohan Raj.
 
He then lodged a complaint with the SEBI which in 2018 fined the Motilal Oswal group to the tune of Rs2 lakh. 
 
Mr Dossani now finds himself in a financial fix as his emergency fund has been misappropriated by the Gada brothers who acted in cahoots with the Motilal Oswal Group.
 
When asked about the case, MOSL replied as follows:
 
1. Mr Amit Gada is a sub-broker of our company. We were not aware of actions of the sub-broker. However, in the month of February 2019, the sub-broker informed us that client has forcefully got some papers signed from him and he has got NC lodged with police.
 
Further, client has sent emails to our grievance id in the month of February / March 2019 and we have duly replied to the same.
 
2. As regards discrepancy, since we are not aware of which specific physical and digital documents you are referring to we are not in a position to comment on the same.
 
However we would like to inform you that we have duly sent copies of contract notes, ledgers, margin report etc, to the client’s email id, regularly informing client about the trades in her account. Also, we were regularly sending SMS to the client informing about the trades in her account. We have also provided to the client web-back office login facility where the client can view all the details with respect to her account. Further, we have sent hard copies of the ledger to the client.
 
There is no discrepancy in the documents provided by us to the client.  It is also pertinent to mention here that we have done surveillance calling where the client confirmed that client is aware about all the trades in her account. In addition to this we would also like to inform you that the client for the purpose of trading in her account has transferred shares from her Demat account with another company.
 
The client has also at multiple times taken payout from her account.
 
3. Since police has registered an FIR on the complaint of client, we are cooperating with police in the investigation by providing information / documents sought by them
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    COMMENTS

    Sreepathid

    3 months ago

    This is clear cut case of Sub broker offering a nice return and that return came from their original investment and loosing that also.

    Parimal Shah

    4 months ago

    Why do we need sub-brokers?
    India has become a country of idle mans.
    And this breeds malpractice, corruption, and exploitation.

    Suketu Shah

    4 months ago

    All stock brokers in India are bad jokes.We donot need them ,they need us.If they are so intelligent and bright,why do they need our money to invest.Let them sit and home,invest their own money and earn 100% /yr returns as they claim.

    Ramesh Poapt

    4 months ago

    traps everywhere in financial matters!

    Top officials told to travel on trains frequently
    In a bid to get first-hand information from railway passengers, Railway Board Chairman Vinod Kumar Yadav has asked all General Managers and other senior officials to travel by trains frequently.
     
    In a letter written to all the General Managers on June 13, Yadav told them to file reports on the services provided by railways.
     
    His order came in the wake of poor quality of food served in India's first semi high-speed train Vande Bharat Express.
     
    In his letter, Yadav said: "Travelling by trains is an opportunity to gain a first hand insight on the actual conditions in respect of our services.
     
    "This alone can provide us 'moments of truth' with our passengers and customers and equip us with invaluable knowledge to continuously innovate and improve (our) services."
     
    Besides travelling by trains on their official tours, the General Managers, Divisional Rail Managers and unit heads were also told to inspect the condition of coaches and interact with passengers.
     
    "A part of the inspection note of the officers must invariably contain a report on the conditions of such facilities and quality of services on trains involving bio-toilets and catering," he said.
     
    He said he expected a feedback from all senior officers including corrective action taken.
     
    The railways have faced flak over poor quality of food as well as choking bio-toilets.
     
    Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.
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    Finance ministry mulling 3-5% tax in Budget on cash withdrawal of 10 lakh a year
    Withdrawing a cumulative Rs 10 lakh a year can attract 3-5 per cent tax if a proposal going around in the Finance Ministry takes shape in the Budget to track high value cash deals and make digital payments mandatory.
     
    In its push towards a digital economy, the central government is thinking of introducing a tax of 3-5 per cent on cash withdrawal of Rs 10 lakh in a year, a move to discourage cash usage in the economy and resultant black money.
     
    Paying Rs 30,000-50,000 for Rs 10 lakh annual withdrawal will be seen as a loss, the government thinks and feels this will discourage large cash transactions.
     
    Official sources said discussions have been held internally on the fallout of such a move and the tax figure is still being discussed though it won't be less than 5 per cent, said sources adding 3-5 per cent is an appropriate figure.
     
    As a step towards this, earlier this week, the Reserve Bank of India waived the fee currently imposed on banks for using its NEFT/RTGS payment servers. The central government also said it was setting up a panel to review charges imposed by banks on ATM withdrawals. RBI said it was doing so to boost digital transactions.
     
    Another source was quoted as saying, "Why should someone withdraw over Rs 10 lakh for cash transactions when digital payments are being encouraged?". It may be noted that just last week, RBI scrapped NEFT and RTGS transfer charges and the central bank is also reviewing the charges on cards as well.
     
    The proposal is at a discussion level but has found favour for being a step towards a digital economy and tracking transactions. Sources said this is a global practice. Even in Pakistan a withdrawal of more than Rs 50,000 attracts such a tax.
     
    During 2005-2008, the UPA government imposed tax on withdrawals of more than Rs 50,000 from current accounts for detection of unaccounted money in the absence of alternative methods. This tax was applicable only on cash and not on payment by cheques.
     
    During 2015, when the Greek economy was on the verge of bankruptcy, millions of panicked citizens completely cleared their accounts by pulling more than 28 billion euros out of banks and pushing the total cash revenue held in the country's financial institutions to a 10-year low.
     
    A high-level committee on digital payments in 2017, headed by Chandrababu Naidu, the then Chief Minister of Andhra Pradesh, had suggested a tax to discourage cash transactions, a cap on the maximum allowable limit for large-size cash transactions and a complete abolition of charges on card payments to incentivise digital transactions.
     
    The committee had submitted the report to Prime Minister Narendra Modi. It had suggested "considering levy of banking cash transaction tax (BCTT) on transactions of Rs 50,000 and above."
     
    To combat this Greek banks proposed taxing cash withdrawals and requiring use of debit and credit cards for all transactions in order to prevent tax evasion. A surcharge for all cashpoint withdrawals was introduced approximately amounting to 1 euro for every 1,000-euro transaction.
     
    It was expected that it would not impact day-to-day withdrawals and will deter citizens from clearing out their bank accounts.
     
    The Finance Act 2017 prescribed imposing a penalty equal to the transacted amount on those who violated the rule restricting cash transactions. It provides that no one can deal in cash in excess of Rs 2 lakh in a single day, in respect of a single transaction or transactions relating to one event or occasion barring a banking company, post office savings bank and cooperative bank.
     
    To curb large cash transactions and discourage black economy, then Finance Minister Arun Jaitley had in the 2017-18 budget proposed to ban transactions of over Rs 3 lakh a day.
     
    This limit was lowered to Rs 2 lakh through an amendment to the Finance Bill 2017 that was later passed by Parliament.
     
    In another related measure, the Finance Act said any capital expenditure in cash exceeding Rs 10,000 shall not be eligible for claiming depreciation allowance or investment-linked deduction. Similarly, the limit for revenue expenditure in cash has been cut to Rs 10,000 from Rs 20,000.
     
    Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.

     

  • User

    COMMENTS

    ROHIT SAXENA

    4 months ago

    It shows a lack of imagination. One would have hoped that govt will learn the lesson from Demo and will not take the ingenuity of Indians lightly. What stops Jewelry shops to become pseudo ATM? This will even force people to keep money out of the banking system, draining out the liquidity.

    Ramesh Poapt

    4 months ago

    good (proposed) move.

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