Following a series of advertisements by ponzi scheme operators assuring investors about the safety of their deposits, the Securities and Exchange Board of India (SEBI) has issued advertisements cautioning them of the risks involved in the collective investment schemes of Rose Valley Real Estate and Construction Ltd, and MPS Greenery Developers Ltd.
The capital market watchdog issued the advertisements in all major national and regional dailies in the wake of the multi-crore Saradha scam, following which a clutch of companies engaged in raising funds under such schemes have been taking to the media to allay investor fears.
As many as eight such companies, including Rose Valley, MPS Greenery, Aspen Projects, Vibgyor Gold, Vibgyor Allied Infrastructure, Prayag Group, Jasoda Real Estate and iCore have come up with advertisements in print as well as TV channels .
“It has come to the notice of SEBI that the Rose Valley Group has released an appeal in the newspaper on April 24, 2013,” SEBI’s advertisement said.
The January 2011 order of SEBI against Rose Valley’s collective investment schemes was challenged by the company in the Calcutta High Court.
“As per the High Court’s order dated May 3, 2013, the hearing in this matter has concluded and the judgement is reserved. The general public are hereby cautioned that none of the companies of Rose Valley Group have obtained a certificate of registration from SEBI to run a CIS to raise money from investors,” the advertisement said.
Incidentally, one of the group outfits of Rose Valley was fined Rs 1 crore by SEBI for its failure to provide details to the regulator.
While SEBI had issued a wind up notice to MPS Greenery in December 2012, the company, in its advertisements, has been claiming that it has court orders to continue collecting funds under CIS.
The SEBI advertisement also clearly spells out that the onus of investing in such schemes would be at investors’ “own risk and responsibility”.