The Securities and Exchange Board of India (SEBI) has asked Alchemist Infra Realty ltd to wind up all 'collective investment schemes' and refund the money collected from public investors, which could be more than Rs1,000 crore, within three months.
Besides, the company and its five directors have also been barred from the securities market till the time all its schemes are wound up and the money is refunded to investors.
The said 'Alchemist Group' is headed by industrialist K D Singh, currently a Rajya Sabha MP of Trinamool Congress from Jharkhand.
In its order dated June 21, Sebi has also warned the company and its directors of initiating prosecution proceedings and a criminal case for "offences of fraud, cheating, criminal breach of trust and misappropriation of public funds" if its orders are not complied with.
Sebi probe also found that the investment application forms of the company also mentioned that it was part of 'Alchemist Group', which was engaged in diverse activities such as steel, food and beverages, IT, healthcare, media, aviation, realty, hospitality, education and tea estate, among others, with asset base of over Rs5,000 crore.
"Thus, an investor/applicant is misled to believe that the company, Alchemist Infra Realty ltd, is part of the Alchemist Group, whereas the company has contended (before Sebi) that it is not associated with the Alchemist Group," the Sebi order said.
Sebi began its investigations into the affairs of the company in 2011 after receipt of an anonymous complaint about Alchemist Infra Realty ltd mobilising money from the public investors in breach of regulations.