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The market regulator has also pointed out violations in norms on related party transactions
In its series of actions against Small and Medium Enterprises (SMEs) found to be violating norms, the Securities and Exchange Board of India (Sebi) on Thursday debarred SecUR Credentials and its managing director Rahul Belwalkar from the securities market.
SecUR, a background check company, was first listed with NSE Emerge, the SME platform by the National Stock Exchange (NSE), and was later migrated to the mainboard of both exchanges in October 2022.
Belwalkar has not only been restricted from buying and selling in the securities market until further orders, but the Sebi order also bars him from holding directorship in any listed company.
The market regulator has alleged the diversion of the company’s funds to the promoter, directors including independent directors, and other entities by the MD.
Sebi’s interim order follows its previous order on Varanium Cloud, which was found to have misutilised funds raised through its initial public offering (IPO). One of the companies with which Varanium was found to have made fictitious purchases was SecUR Credentials.
Further, Belwalkar had also transferred Rs 8.23 crore to the MD of Varanium.
The market regulator has also pointed out violations in norms on related party transactions.
“The company and its MD have also adopted a cavalier approach while seeking to ensure compliance with fair and accurate disclosure requirements, as is evident from the non-disclosure of the outstanding balance in respect of the unsecured loan availed from its MD, accurate disclosure of the status of its rights issue, etc.,” said Sebi.
The matter has been referred to the National Financial Reporting Authority for examining and taking action for any lapses by the firm’s auditor.
First Published: Jun 13 2024 | 7:59 PM IST
