Some Lesser Known Facts About Harshad Mehta
- Harshad Mehta was born right into a Gujarati Jain household. He went on to orchestrate the most important ever inventory market rip-off within the historical past of Independent India.
- Harshad spent his early childhood years in Kandivali Mumbai, the place his father, Shantilal, used to run a small textile enterprise. Later, the Mehta household moved to Raipur, the place Harshad did his education after which got here again to Bombay (now Mumbai) for his commencement in 1973.
- After finishing his commencement in 1976, for the subsequent eight years, Harshad labored in a number of jobs. He grew to become a cement contractor, offered hosiery, sorted diamonds, labored as an insurance coverage clerk, and did many different sales-related jobs.
- In the meantime, whereas working as an insurance coverage agent within the Bombay workplace of New India Assurance Company Limited (NIACL), Harshad took an interest within the inventory market. In 1981, he give up his job at NIACL and began working as a jobber (an individual who brings shoppers to the inventory market brokers) for a inventory dealer, Prasann Pranjivandas, whom he referred as his guru in share market enterprise.
- Eventually, in 1984, Harshad Mehta grew to become a member of the Bombay Stock Exchange (BSE) and established his personal inventory brokerage agency beneath the identify “GrowMore Research and Asset Management.”
- Harshad’s enterprise witnessed a meteoric rise. By the top of 1991, he had already risen to such prominence that the media began referring to him because the “Big Bull” & the “Amitabh Bachchan of Stock Market.”
- Harshad’s type of doing enterprise was easy. He would secretively siphon off an unlimited sum of cash from authorities safety markets for a short interval after which make investments this cash in a couple of chosen securities. The quantity he used to take a position was so excessive that the value of that share would rise exponentially after which fall as again when he would promote his shares. When folks would get excited a couple of specific safety, Harshad Mehta would slowly liquidate his shares, repay the siphoned off cash to the banks and pocket the big distinction attributable to rising safety costs. In one 12 months, he had elevated the Sensex, i.e. the indicator of the Bombay Stock Exchange from 1000 to 4500.
- Harshad took benefit of the loopholes within the banking system. He was persevering with this follow at an unimaginable scale.
- He invested in numerous corporations, together with Apollo tyres, Reliance, Tata Iron and Steel, BPL, Videocon, ACC. He manipulated the shares ACC and took its share value from Rs 200 to Rs 9000 (4500 p.c rise).
- He was one of many greatest Indian taxpayers throughout these instances.
- His lavish way of life included a sea-facing 15,000 sq. ft penthouse in Mumbai’s Worli with a mini-golf course and swimming pool. Along with that, he owned a fleet of fancy vehicles used to journey by a Rs 40 lakh Toyota Lexus. All in all, he used to reside an opulent life that individuals might solely dream of.
- Things have been going easily for Harshad till a journalist, Sucheta Dalal, was intrigued by his lavish way of life. She additional investigated the sources by which Harshad Mehta has collected fortunes value 1000 crores in such a short while span.
- Eventually, on 23 April 1992, the untold reality behind Harshad’s exponential rise was dropped at the general public eye for the primary time by a journalist, Sucheta Dalal, who revealed an article in The Times of India, explaining precisely how he had carried out 500 crores of monetary fraud from the treasury of the State Bank of India. The subsequent 12 months in 1993, Sucheta Dalal additionally revealed a e book, “The Scam: Who Won, Who Lost, Who Got Away” together with Debashis Basu primarily based on the rip-off.
- When his scheme was uncovered, the banks began to ask for his or her cash. The publicity of the Harshad Mehta Scam prompted a serious inventory market crash and washed away trillions of buyers’ wealth in lower than two months.
- Consequently, Harshad Mehta was arrested by the CBI in November 1992, alongside along with his brothers, Sudhir and Ashwin, who have been additionally concerned in finishing up the rip-off. The CBI charged Harshad Mehta of 72 prison offences and above 600 prison motion instances have been lodged in opposition to him by varied banks and establishments.
- Harshad employed the well-known veteran lawyer Ram Jethmalani to see his case. He was granted bail after spending three months in jail.
- After getting launched, Harshad held a press convention whereby he claimed to have paid INR 1 crore as a bribe to the then PM Narasimha Rao to get him off the case. However, the Indian National Congress Party rubbished the allegations made by Harshad Mehta. Also, no proof was discovered in opposition to Narasimha Rao exhibiting that he had taken the bribe.
- The RBI shaped the Janakiraman Committee to analyze into the matter. The committee reported the rip-off to be of a magnitude of INR 4025 crore rupees. The reported sum, if put into perspective in 2020, it might quantity to INR 24000 crore.
- In September 1999, the High courtroom of Bombay convicted Harshad Mehta and sentenced him to five years of imprisonment.
- Harshad Mehta was in serving his time period within the Thane Prison when he complained of chest ache and was taken to Thane Civil Hospital. On 31 December 2011, Hemant died of a coronary heart ailment.
- In 2020, an online sequence, “Scam 1992 – The Harshad Mehta Story,” base on Harshad’s life, was launched on Sony LIV.
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