This article discussed the Harshad Mehta scandal in detail. It discusses how Harshad Mehta could pull off such a huge scandal and what the motivations of the. Hence after studying and doing the deep analysis, I have written the detailed case study in simple language about the Harshad Mehta scam, so that everyone . The Harshad Mehta case can only end in stages. Firstly, the I-T Department will have to re-assess its claims and come up with a figure that is.

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Mehta was arrested by investigation agencies in November Banks and financial institutions are yet to get their money back. The family has to pay crore to various banks and about Rs 11, crore to IT Department mainly interest accrued and penalties. After graduation, Mehta tried his hand at various jobs, often related to sales, including selling hosiery, cement, and sorting diamonds.

D The brokers also used bank receipts BRs in lieu of securities that were traded. It is said, stocks like ACC surged from about Rs per share to about Rs apiece during this period. The scheme was financed by supposedly collateralised bank receipts, which were in stuxy uncollateralised.

Periodically, the custodian files a confidential report valuing the property under its custody and liabilities to be paid off.

Ethics in Indian Businesses: Case Studies of Harshad Mehta, Ranbaxy, Satyam& Others

One muggy afternoon a few years ago, after another hectic day in a Mumbai court, Ashwin Mehta walked up to the lawyers of the opposite camp, which represented a bunch of banks and financial institutions. The Harshad Mehta case has dragged on for too long.


Investigators haul in more people, discover ever-widening net”. Mehts The brokers colluded with a couple of banks which issued fake BRs — ones without any security backing. In criminal indictments later brought by the authorities, it was alleged that Mehta and his associates then undertook a much broader scheme, which resulted in manipulating the rise in the Bombay Stock Exchange.

Indian Stock Market Scam by Harshad Mehta: Implications – Case Study

Directors are picked from an “old boy’s network” – they are people close to a promoter or from a familiar circle. How to Negotiate Salary while taking Job offer? This competition and the desire to gain an advantage over competitors drove the banks into the schemes of cunning brokers like Harshad Mehta.

During this period, especially in —, the media portrayed a heightened deified image of Mehta, calling him “The Big Bull”.

Narasimha Raoas donation to the party, for getting cawe off the scandal case. The Harshad Mehta scam was discovered when attention was paid to the money missing from the government securities market. Find this comment offensive? Frequent litigation barshad the family has also delayed the case inexplicably.

He was tried for 9 years, until he died in late Mehta was under Criminal custody in the Thane prison. Witnesses, documents and evidence have become irrelevant. It is another matter that Harshad conducted trades on their behalf in the earlys.

He died following harsahd brief heart ailment, at the age of 47, on 31 December Read times Last modified on Monday, 16 April So in real terms, securities did not change hands, but only BRs did. Writing the cheque in favor of the broker was forbidden by law.

Official website of Sucheta Dalal. He had altogether 28 cases registered against him. The Big Bull is long dead and his brother has had time to become a lawyer and argue his case. The shares were sold at profits thanks to pumped up markets and the BR retired when it was time to return money to the bank. Compared to that, the market for government securities had less than a dozen brokers that operated.


A typical ready forward deal involved two banks brought together by a broker in lieu of a commission. Hence, for this short time duration, the money was essentially an unsecured loan to the broker and could be used to rig the markets.

Get instant notifications from Economic Times Allow Not now. The securities scam of refers to a diversion of bank funds worth Rs crore to a clutch of stockbrokers – the kingpin being Bombay-based broker Harshad Mehta. From Wikipedia, the free encyclopedia. Harshad Mehta was a broker with significant clientele in the 90s.

On March 1,the SEC filed an administrative civil complaint against Gupta for insider trading with billionaire and Galleon Group hedge fund founder Rajaratnam. The case is now being fought on over a dozen fronts — with every individual member in the Mehta family approaching the courts for reprieve on various matters.

In one year, he had driven the Sensex i. There was thus a huge competition amongst banks for the additional cash that was held by the Indian corporate sector particularly the oil and gas public sector units.