The Hindu Business Line : YES Bank IPO scam: Her office stays closed after SEBI bar

A LOCK stares at you at 402-403, Shashwat Building, Ahmedabad, the address provided by Ms Roopalben Panchal, one of the barred investors who had allegedly manipulated allotment of shares in the YES Bank initial public offer.

Neighbours tell you that some four to five employees used to work at the Panchals' office being run by Ms Roopalben Panchal's relative, Mr Deepak Panchal. The office was functional till Thursday, but after the Securities and Exchange Board of India announced the name of Ms Panchal and the address, the office was closed and has not opened since.

Ms Panchal is among the 13 individuals and entities who had allegedly worked out an ingenious method to get higher allotment in public issues from the retail segment by opening more than 7,500 benami demat accounts.

"If you make an application as a high networth individual (HNI), the chances of allotment were low. If, using the same money, you could make more applications through benami accounts, the chances of allotment rise at least five times," says a stock broker here.

Ms Panchal and others did precisely that - channelise the funds into the retail segment and get higher allotment. By ensuring that all the applications were below Rs 50,000, the cut-off limit for small retail investors, they played in the retail segment where chances of allotment are higher and checks were not very vigorous.

"For applying for smaller number of shares, the investor was not even required to quote his/her PAN number," the broker said. According to the SEBI report, Ms Roopalben Panchal had applied for 1,050 YES Bank shares and paid application money of Rs 47,250. Apparently she did not receive any allotment in that category.

Later, she received 150 shares each from 6,315 allottees through off-market transfer. Thus, she received 9,47,250 shares in aggregate, which she sold through five other entities on the day of listing.

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YES Bank IPO scam: Her office stays closed after SEBI bar