As Sebi widens its probe into use of stock market platforms for evading taxes and laundering black money, a large number of small NBFCs and brokers have come under its scanner for having facilitated illicit transactions worth thousands of crores of rupees over the past 2-3 years. It has emerged during initial investigations by Sebi and stock exchanges that such illicit activities tend to accelerate during last few months of a fiscal and quantum of such transactions has grown manifold in the last few years.
Besides, a number of such entities, which includes both individuals and corporate brokerage firms, have been found to be repeat offenders for various offences in the securities market and many of them create new shell companies to hide their past precedents, sources said. Those under the scanner also include select listed companies and their promoters, who regularly offer their services for channelising black money and for evading taxes through use of stock exchange platforms.
In just two cases, where Sebi last week passed interim orders, total illicit gains estimated worth Rs 500 crore have come to the fore in case of a select few entities. Besides, being possible cases of money laundering or tax evasion, Sebi has found such activities to be securities market frauds as well, as they involve manipulative transactions in securities and misuse of the market.
In its biggest ever crackdown for suspected tax evasion and laundering of black money through stock trading platforms, Sebi on Friday barred 260 entities, including individuals and companies, from the securities markets.