Sebon uncovers scam

Investors have been, for long, complaining of foul play in the capital market. But for the first time, Securities Board of Nepal (Sebon) has uncovered what appears to be a huge financial scam in the capital market that might be only the tip of an iceburg. "Sebon has stopped the allotment process of Employment Promotion and Development Bank's (EPDB) shares until its investigation completes. It has also written to Ace Development Bank, the issue manager of EPDB's Initial Public Offerings (IPOs), to stop the process of allotment," said Dr Chiranjivi Nepal, chairman of Sebon, the regulatory authority of the capital market. "After we got complaints of foul play in IPOs, we randomly checked the collection centres," he informed, adding that the inspection team then took control of the suspected forms. "Sebon inspection team has randomly taken control of a couple hundreds of forms that are being suspected of fraudulent," said P N Poudyal, director, Market Regulation Department of the Sebon. "Such forms will be cancelled which is necessary to clean up the market," said Neeraj Giri, director at the Sebon, without elaborating on what action the regulatory authority is going to take. The EPDB had received 5,00,000 applications amounting to over eight billion rupees that it claimed to be oversubscribed by 66 per cent. It had floated shares worth Rs 128 million for public. Such incidents call for an urgency of new IPO regulation that is in offing and is expected to control such foul play.

This shows how irresponsible and careless our government is. What is the right action for the government? Just eliminate those applications or keep those applications to get the information of knowing who is doing it and taking some legal actions?