New Delhi: The Securities and Exchange Board of India (Sebi) has expanded its probe into alleged misdoings at Ricoh India with fresh disclosures that its accounts appear to be “falsified” and the company is estimated to see a loss of Rs 1,123 crore in the last fiscal year.
The company, a subsidiary of Japanese imaging and electronic major Ricoh, has been under the scanner of Sebi for some time and the regulator would now also look at possible fund diversions.
The suspected misdoings at Ricoh India is likely to be the biggest corporate fraud involving a local company after the Satyam scandal came to light in 2009.
Sources said the role of auditors, top executives, their associates and brokers as well as some promoter entities would be looked into in the Ricoh India case.
Crisis-hit Ricoh India on Tuesday admitted its accounts appear to be have been “falsified” as it estimated to incur a loss of Rs 1,123 crore for the year ended March 2016, even as its promoter entity Ricoh Company Ltd has proposed to recapitalise the firm for the loss.
The alleged misdoings at Ricoh India, during the period starting from 2010 to 2011 when the share price witnessed a significant rise, are being looked into by Sebi.
Sources said financial accounts of at least six years are being looked into and certain quarters during this period saw “sharp surge of up to doubling of profits”.
Though many financial parameters are suspected to have been weak followed by almost 300 per cent rally in share price in early 2015, they added.
BSE has suspended trading in the shares of Ricoh India “due to penal reasons”.
Tightening the noose, Sebi has stepped up its probe in the matter as it was till now looking mainly at violations of listing and disclosure norms.
So far, sources said the probe was focused on listing agreement violations such as delay in filing returns and shareholding pattern but now more serious violations of corporate governance norms are being looked into.
In addition, suspected diversion of funds and unauthorised insider trading and related party transactions would also be looked at in depth, they added.
The regulator would also be referring the matter to the Corporate Affairs Ministry and possibly seek a probe by the Serious Fraud Investigation Office (SFIO).
Ricoh India MD and CEO Manoj Kumar had resigned from the board after being asked to go on leave amid an audit in the company by a committee.