This was the second most important scam that rocked the Bombay Stock Exchange after the Harshad Mehta scam. Ketan Parekh is a former stock broker from Mumbai,who was convicted in 2008, for the involvement in India stock market manipulation,that occured from late 1998 to 2001.

1. Presented By:
Nancy Gupta
Mahima Arora
Nayanika Sharma
Mohd. Tabrez
Tanya

3.  Former stock broker from
Mumbai, India popularly
known as ‘Bombay Bull’.
 He was a Chartered
Accountant by professional
training.
 He was the trainee of Harshad
Mehta.
 Ketan Parekh can be best
described as the Pied Piper of
Dalal Street.
 Parekh has a stock broker
family background.
 He has been debarred from
trading in the Indian stock
exchanges till 2017.

4. A ”Pump and Dump” scam is the illegal act of an investor or
group of investors promoting a stock they hold and selling once
the stock price has risen following the surge in interest as a
result of the endorsement.

5. Retail Investor Institutional Investor
 Retail Investors, often
referred to as individual
traders, buy or sell securities
for personal accounts.
 Their risk taking ability is
very less.
 Their financial planning and
management is not very
efficient, at least when
compared to their
counterpart.
 Institutional traders buy and
sell securities for accounts
they manage for a group or
institution.
 Their risk taking capacity is
far more than that of their
counterpart.
 Their Financial Planning and
Management is very
sophisticated and perfect.

6. Insider trading is the buying or selling of a
security by someone who has access to material
nonpublic information about the security.
Insider trading can be ethical or unethical
depending on when the insider makes the trade.
However, some economists, have argued that
insider trading should be allowed and could, in
fact, benefit markets.

7. •Circular trading is a
fraudulent scheme where sell
orders are entered by a broker
who knows that offsetting buy
orders for the exact same
number of shares at the same
time and, at the same price,
have either been or will be
entered.
•It inflates volumes as a way to
show that a security has
liquidity.
Trading

8. 1. Global Tele-systems
2. Zee Telefilms
3. HFCL
4. Silverline
5. Satyam Computers
6. Aftek Infosys
7. DSQ Software
8. Pentamedia Graphics
9. SSI
10. Ranbaxy
 These stocks seemed to be
actively traded because of
high volume of stocks and
thus it created an image that
many investors are interested
in buying the stocks.
 Some of the Institutional
investors also started investing
in these stocks which caused
the demand and price of the
stocks to rise.
 This furthur made the retail
investors to invest.

9.  1997 to 2001-02 was an era of Dot-com Boom, wherein technology
and telecom equipment providing companies flourished and their
stocks increased rapidly capturing the interest of the investors.
DOT-COM BOOM
 Ketan Parekh started
manipulating their stocks which
specified that K-10 stocks
increased due to future growth
and dot-com boom.
 Made sure that these companies
always made it to the headlines.

10. Impact On Stock Price

11. Impact On Stock Price

12. Company Promoters
Banks:
GTB (Global Trust Bank)
MMCB (Madhavpura Mercentile
Co-operative Bank)
Ketan Parekh

14. What is a Whistleblower?
 A person who makes public
disclosure of corruption and the
wrongdoing in an organisation.
 Internal : disclosure within the
organisation
 External: Reports to people outside
the organisation such as law
enforcement or media.
TYPES

15. Companies Act, 2013
Whistle Blower Policy
 Listed companies and companies which accept deposit from
public or have borrowed money from the banks and PFI’s in excess
of Rs. 50 crore.
 Audit committee shall overseas the vigil mechanism otherwise
board shall nominate a director.
 Ensure Safeguards against victimisation of employees and
directors, direct access to the chairperson of the company
 Ensure that interests of a person who uses the mechanism are not
prejudicially affected

16. Exposure of the scam
•Sucheta Dalal (born 1962)
• She is an award-winning business
journalist and author.
•She has been a journalist for 25 years
and was conferred the
prestigious Padma Shri for journalism
in 2006.
•She has been the Financial Editor of
the Times of India until 1998.
•She was the lady behind Harshad
Mehta scam and now Ketan Parekh
scam who had helped a lot in
exposing both of them.

18. Penalties Slapped On Parekh By
SEBI
 Ketan Parekh and six stock broking entities associated with
him have been debarred by SEBI.
 SEBI cancelled the certificate of stock broking registration
granted to TIFL(Triumph International Finance(India)
LTD., in which KP is a director.
 The Central Bureau of Investigation(CBI) arrested KP
and three other co-accused directors of TIFIL in
connection with the securities scam.
 The Enforcement Directorate(ED) imposed a penalty of
Rs 10 million on TIFIL, Rs 2 million on KP and other
director, and Rs 1 million on other two director.