FINANCIAL SCAMS IN INDIA

INTRODUCTION
Financial scams can be broadly defined as an intentional act ofdeception involv
ing financial transactions for purpose of personal gain.Scams is a crime, and is a
lso a civil law violation. Many scams casesinvolve complicated financial transac
tions conducted by 'white collar criminals'such as business professionals with s
pecialized knowledge and criminal intent.An unscrupulous investment broker 
may present clients with anopportunity to purchase shares in precious metal r
epositories, for example. Hisstatus as a professional investor gives him credibili
ty, which can lead to justifiedcredibility among potential clients. Those who bel
ieve the opportunity to belegitimate contribute substantial amounts of cash an
d receive authentic-looking bond documentation in return. If the investment br
oker is fully aware that no suchrepositories exist and still receives payments for 
worthless bonds, then victims maysue him for scams.Scamssters can contact th
eir potential victims through many methods,which include face- to-face interac
tion, by post, phone calls, sms and/or emails.The difficulty of checking identitie
s and legitimacy of india.

LIST OF SCAMS
1. INDIAN COAL ALLOCATION SCAM

2. SATYAM SCAM

3. 2G SPECTRUM SCAM

4. STAMP PAPER SCAM

5. BIHAR FODDER SCAM

6. HARSHAD MEHTA SCAM (1992), KETAN PAREKH SCAM (2008)

7. MINING SCAM OF INDIA

8. D.K.SHIVKUMAR MONEY LAUNDRING SCAM, HASAN ALI KHAN

9. ANUBHAV MITTAL ABLAZE INFO SOLUTIONS SCAM

10. PAAZEE FOREX SCAM

11. IPO SCAM

12. SHARDHA SCAM

13. SPEAK ASIA SCAM

14. HUDCO SCAM

15. KINGFISHER SCAM

1. SATYAM SCAM
In 2009, Satyam Computer Services' B Ramalinga Raju admitted and confessed
to a large-scale financial manipulations to the tune of Rs 50.4 billion in Satyam’s
books of account. Soon after, SEBI initiated investigation, and there began 'the
Satyam Saga', the biggest corporate fraud in India until then. From top
management to auditors -- all came under the scrunity and were awarded
punishments for their respective roles in the Satyam scam.

2. KINGFISHER SCAM
2005: Vijay Mallya chairman of United Breweries (Holding) Limited, started the
luxury airline: Kingfisher Airlines.

2007: Vijay Mallya acquires Air Deccan, which was a low-cost airline, from
owner Capt. Gopinath.

2008: The Air Deccan takeover was formalized and UB group paid up Rs.550
crores (US$79 million) for its stake of 26% in the company.

Later that same year Kingfisher Airlines faced a loss of Rs934 crore (US$133
million) due to various reasons like oil price increases, acquisition of a financially
unsound airline and other reasons.

2009: The consolidated debt of the airline accumulates to a massive Rs5,665

crore (US$810 million) that increases to Rs7,000 crores (US$1 billion). IDBI bank
issues a loan of Rs900 crores (US$128 million) to the airline.

Kingfisher’s board approves a resolution to raise $100 million by various

instruments including Global Depository Receipts. This was in addition to raise
capital for an amount not exceeding Rs500 crore (US$71 million)by a rights issue
of equity shares.
Kingfisher reports a net loss of Rs418.77 crores (US$59 million) during the
second quarter of the fiscal year. Its income from operations also declines by
13.6 per cent during the quarter compared to the same period the previous year.
In view of the huge losses and capacity reduction, Kingfisher decides to lay off
nearly 100 pilots.
2010: Banks give the airline an ultimatum of nine months to pay back the entire
loan amount that stands at $1.3 billion.

Kingfisher Airlines Board approves debt recast package. The airline’s debt now
stands at Rs6,000 crore (US$858 million).
2011-Mumbai International Airport Pvt. Ltd. sends a notice to the cash-strapped
airline to pay Rs90 crore (US$12million)outstanding dues.
The Income Tax Department freezes 11 accounts of Kingfisher Airlines for non-
payment of tax.
2012: Kingfisher Airlines cancels several of its flights after the Income Tax
Department froze some of its accounts.

The carrier operates on a trimmed schedule and faces the prospect of losing a
number of prime flying slots.
International Air Transport Association asks travel agents to immediately stop
booking tickets on Kingfisher’s behalf for failure to settle dues since February.
Further trouble, as employees protest delays in salary payment.
Kingfisher announces reduction of its international operations.
Revenue department of India threatens to take Kingfisher Airlines to court over
alleged tax evasion, claiming the company has not deposited taxes it collected
from travelers.
Lenders give two weeks to come up with a plan to improve operations. The airline
had a total outstanding debt of around Rs.7,500 crore (US$1 billion)to a
consortium of 17 banks led by State Bank of India(SBI).
Unpaid staff protest in Delhi, Mumbai and other airports and almost all of
Kingfisher’s flights from all stations were cancelled as engineers did not certify
the planes to fly.
A non-bailable arrest warrant issued against Vijay Mallya, and four other directors
for non-appearance in cases relating to bouncing of cheques issued in favour of
GMR Hyderabad International Airport Limited (GHIAL) towards user charges.
The carrier loses its flying license as the DGCA refused to renew its Air Operator
Permit (AOP).
2013: DGCA asks the carrier to clear all dues, including pending salaries of
employees, before seeking license renewal.

2014: Kingfisher Airlines reported a net loss of Rs822.42 crore (US$117

million)for the third quarter ended December 31, 2013.
United Bank of India declares Mallya and three directors of Kingfisher Airlines as
willful defaulters.
2016: Banks move Supreme Court to ban Mallya’s overseas travel.

Mallya leaves India on March 2, government tells court.

3. PONZI SCAM (ANUBHAV MITTAL)

Alarmed at the Rs 3,700 crore Ponzi scam orchestrated by Anubhav Mittal's
socialtrade.biz based Social Trade Scam, which involved over six lakh investors,
panic gripped investors who have put their money in similar 'pay per click' plans
of other companies. So some companies like these suspended operations or
some started refunding investors, while others asked investors to opt for bitcoin.
In this case, Tornado also started returning money as bank transfer[1] but it didn't
last long and it collapsed on 20 March 2017.

4. HARSHD MEHTA SCAM(1992), KETAN PAREKH SCAM(2008)

Harshad Mehta was an Indian stockbroker, well known for his wealth and for
having been charged with numerous financial crimes that took place in the 1992
securities scam.[1]
Of the 27 criminal charges brought against him, he was only convicted of four,
before his death at age 47 in 2001.[2] It was alleged that Mehta engaged in a
massive stock manipulation scheme financed by worthless bank receipts, which
his firm brokered in "ready forward" transactions between banks. Mehta was
convicted by the Bombay High Court and Supreme Court of India[3] for his part in
a financial scandal valued at ₹ 5000 Crores which took place on the Bombay
Stock Exchange (BSE). The scandal exposed the loopholes in the Indian banking
system, Bombay Stock Exchange (BSE) transaction system and SEBI further
introduced new rules to cover those loopholes. He was tried for 9 years, until he
died in late 2001.

Ketan Parekh is a former stock broker from Mumbai, India, who was convicted in

2008, for involvement in the Indian stock market manipulation scam that occurred
from late 1998 to 2001.[1] During this period, Parekh artificially rigged prices of
certain chosen securities (informally referred to as K-10 stocks), using large sums
of money borrowed from banks including the Madhavpura Mercantile Co-
operative Bank, of which he himself was a director. [2] As a result, he was barred
from trading in the Indian stock exchanges till 2017.