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1. Harshad Mehta Scam.
History of Harshad Mehta:Who was Harshad Mehta?
● Harshad Mehta was an Indian stockbroker, well known for his wealth and for having
been charged with numerous financial crimes that took place in the Securities Scam of
1992.
● He completed his B.com in 1976 from Lalalajpatrai College in Mumbai and worked a
number of odd job for next 8 years. During this time he got interested in share market
and after a few year he joined the brokerage firm.
● In 1984, he became a member of Bombay stock exchange as a broker and established
his own firm Grow More Research and asset management.
When the scam took place:
● He actively started trading in 1986, and by early 1990 a number of eminent
people began to invest in his firm and utilizes his service.
● During this period, especially in 1990-1991 the media portrayed the
dignified image of Mehta, calling him "The Big Bull".

2. The Scam that shook India:
● Upto early 90s the bank in India were not allowed to invest in equity markets. Mehta
cleverly squeezed the capital out of the banking system to address this requirement of
banks and pumped this money to share market.
● At that time a bank had to go through a broker to buy securities and forward the bond to
another bank.
● He also promised banks higher rate of interest while asking them to transfer the money
into his personal account under the guise of buying securities for them from another
bank.
● Another instrument used in a big way was Bank receipt (BR).In a Ready forward deal
securities were not moved back and forth actuality. BR confirms the sale of securities
and it acts as a receipt for the money received by the selling bank.
How he was exposed:
● On 23rd April 1992, Journalist Sucheta Dalal exposed Mehta's illegal
method of broking in the column in The Times of India.
● A typical Ready forward deal involved two banks brought together by a
broker in a lieu of commission, the broker handles neither the cash nor the
securities.
● Mehta and his brothers were arrested by the CBI on 9 November 1992 for
allegedly misappropriating more than 2.8 million shares of about 90
companies, Alligation of payment of bribe to India's Prime Minister PV
Narshimha Rao.

3. Conclusion:
● A Joint Parliamentary Committee named Ram Niwas Mirdha committee
was formed on Harshad Mehta Scam.
● Over a 4000Crtoday's worth of 24000 Cr scam was done by Harshad
Mehta. He was later charged with 72 criminal offences and more than
600 civil suits were filed against him.
● Banks started demanding their money back, causing the collapse.
● Market watchdog, Securities and exchange board of India had banned
him for life from market related activities.
● Mehta was under a criminal custodyin Thane prison. He died following a
brief heart ailment at the age of 47, 31 December2001.