Harshad Mehta was an Indian stockbroker born in 1953 who triggered a securities scam in 1992 by diverting Rs. 4,000 crore from banks to inflate stock prices. He took advantage of loopholes in the banking system to siphoned money and bought shares, artificially raising prices. His actions were later exposed, causing the stock market to crash and devastating many investors. Mehta was charged with 72 criminal offenses and banned from trading, and his actions highlighted issues with regulation and oversight in the financial system.

1. Member : Navin Pal
21
Lav Hotkar
17
Neeraj Bidlan 22

2. 
Name: Harshad Shantilal Mehta

Born in: 29 July 1953

Died in: 31 December 2001

Profession: Chartered Accountant & Stockbroker

He earned degree in Bachelor of Commerce

Started his working life as an employee of the
New India Assurance Company

3. 
In the early eighties he quit his job and sought a
job with stock broker P. Ambalal affiliated to
Bombay Stock Exchange

He became a jobber on BSE for stock broker P.D.
Shukla after that

In 1981 he became a sub-broker for stock brokers
J.L. Shah and Nandalal Sheth

He took advantages of loopholes in banking system

He triggered SENSEX in 1992 & made the scam by
diverting funds of Rs.4,000 crore

4.  Imaginary
companies created
 Bought the shares of own company by himself
causing Sensex up
 Purchased Huge amount of shares of a targeted
company like ACC .
 Created fake BRs, or BRs not backed by any
government securities
 Illegally issue of BR by small bank
 Without verification, banks like “Vijaya Bank”
issued the cheque
 Recommendation to purchase particular shares on
his own website

5.  Harshad
Mehta & His Associates.
 Sudhir Mehta.
 Bank of Karad (BOK).
 Metropolitan Co- Operative Bank.
 Vijaya Bank.

6.  Mehta
soon mastered the tricks of trade by
managing several brokers and set out on dangerous
game plan
 Mehta has siphons off the huge money from several
banks and million of investors were connecting the
process.
 His scam was exposed and the market crashed.

7.  He
triggered the rise in Bombay stock exchange in
the year 1992 by trading in shares at premium
across many segments
 Taking
advantages of loopholes in the banking
system, harshad and his associates triggered a
securities scam diverting funds to the tune of RS
4000 crore from the banks to stock holders
between April 1991 to may 1992.

8.  He
was arrested and banned for life from trading
in the stock markets
 Major
culprits were brokers, bankers and financial
institutions.
 He
was charged with 72 criminal offences. A
special court also sentenced Sudhir Mehta,
harshad’s brother, 6 others, including four bank
officials.

9.  They
got rigorous imprisonment from 1 year to 10
years on a charge of dumping state bank of India
to the tune of RS. 600 crore in connection with
the securities scam than rocked the financial
markets in 1992.

11.  Lifestyle
(flashy cars and life like a celebrity)
 31st December 2001- the death of the bull
 Forever remembered as the architect RS. 50 billion
scam

12.  He
was later charged with 72 criminal offenses,
and more than 600 civil action suits were filed
against him
 He
was arrested and banished from the stock
market
 Mehta
and his brothers were arrested by the CBI on
November 9, 1992 for allegedly misappropriating
more than 27 lakh shares of about 90 companies

13.  There
is no effect on society
Reasons: Acts only if it affects
 People forget things easily
 Government taking things lightly
 THUS Within 10 years history repeated

Same things

Same story

Same people

Same Government
Just a new name to blame Ketan Parekh

14.  Normal
transactions must be allowed to be done
openly and transparently, and the role of brokers
as market makers must be recognized.
 Artificial
barriers between the money market and
the capital market, between the market for
corporate securities and the market for
government securities and between the formal
money market and the informal one must be
eliminated.

15.  Harshad
Mehta was brave stock broker. He knew
the loopholes in banking system as well as how to
exploit that loopholes. His whole intension to do
this was to rise in SENSEX.