New Delhi:Sebi has barred three former top executives of Geodesic Ltd, which owned children's magazine Chandamama, from the securities markets for one year for siphoning off funds. Those barred by the capital markets regulator are -- Kiran Kulkarni, who was the managing director of Geodesic; Pankaj Kumar, who was the company's chairman; and Prashant Mulekar, who was the director and compliance officer, according to a Sebi order.
Chandamama India Limited, the publisher of the much-loved Chandamama range of children's magazines, was a subsidiary of Geodesic Ltd. In its order, Sebi found that these persons were involved in siphoning of USD 125 million raised by the company through redeemable Foreign Currency Convertible Bonds (FCCBs) from overseas investors in 2008. The funds were mobilised for the purpose of investing in companies including wholly owned subsidiaries.
As per Sebi, audited balance sheet of the company for FY 2011-12 was full of misleading financial data and did not contain the true and correct numbers pertaining to its financial health. The forensic auditor appointed by Sebi in its report indicated that complex layered transactions were executed on behalf of the company and the persons behind such acts were Kulkarni, Kumar and Mulekar, who were the promoter and directors of the firm.
The funds were first invested in the foreign subsidiaries of the company -- GTSL, Hong Kong and Geodesic Holding Limited Mauritius -- from where such funds were further diverted to other entities. "The investments which were reflected to have been made in the foreign subsidiaries, were further siphoned off from the accounts of those foreign subsidiaries to other various entities of suspected status and dubious antecedents," Sebi said in its 56-page order passed on Monday.