Horrified clients accuse equities broking firm India Infoline of trading in their demat accounts 'without permission or authorisation'
Horrified clients accuse equities broking firm India Infoline of trading in their demat accounts 'without permission or authorisation'u00a0
The shocking story as it unfolded.
September 2008: Dr Babulal Rustogi, a retired government schoolteacher, receives an SMS from India Infoline, informing him of a transaction worth Rs 2.58 lakh in his account. Rustogi is shocked as he had not authorised the transaction.
He approaches the National Stock Exchange (NSE) and files a police complaint. India Infoline only offers contradicting answers.
May 2009: Pravesh Rawat, a Gurgaon resident, notices shares worth Rs 15,000 have been sold off by India Infoline without his "permission."
April 6, 2009: Aarti Gunjikar from Mumbai files a complaint to the police that India Infoline had transacted from her demat account without authorisation.
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The Bandra police arrest Nitin Khandelwal, the territory manager of India Infoline, for allegedly allowing short-term trading in her account despite instructions to the contrary.
In seven months, one official arrested, two complaints of malpractices filed with the police and many more miffed investors.
Seems India Infoline, one of the most reputed financial brands in the country, is suddenly in the eye of a dark storm. And in these recessionary times, this one could well prove to be the shadiest of them all.
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Without permission
Retired school teacher Dr Babulal Rustogi said that India Infoline made transactions in his account without his "permission" or without "informing" him.
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His son, Dr Navneet, with Guru Govind Singh Hospital in west Delhi, said that his father had opened a demat account on August 2008.
"A month later, my father received an SMS saying that a transaction of Rs 2.58 lakh had been made from his account.
We were shocked, as we had not ordered any transaction. I spoke to the relationship manager of India Infoline's Janakpuri branch and he said it was a mistake.
He also said it would be immediately rectified. However, they kept delaying it," said Dr Navneet.
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After waiting for about two months, in the first week of October, the Rustogis complained to the NSE and approached the police.
But contradictory replies from India Infoline shocked them. "On October 8, India Infoline filed a reply at the Janakpuri police station saying I had called them from a landline number and had asked them to trade in my father's account.
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"However, in the reply filed to the officer-in-charge of NSE on November 11, 2008, the company stated that a branch official of India Infoline had rung me up on August 25 and that I ordered the trading of my father's shares.
The company is cheating us and that is why it is filing contradictory replies to various agencies," said Navneet Rustogi.u00a0
MiD DAY has in its possession copies of the replies filed by India Infoline to the police and the NSE.
On October 20, 2008, the Rustogis filed a complaint with the Economic Offence Wing.
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They have also lodged complaints with the consumer court in Delhi and the Securities Exchange Board of India, but there has been no development in the case.
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Meanwhile, the relationship manager of India Infoline's Janakpuri branch, Harpreet Singh, said, "False charges are being levied against me.
We had received instructions from Dr Rustogi to go ahead with the said transactions in his father's account.
His father authorised the transactions. But while filing the replies to the police and the NSE, I became confused as to whether I had called Dr Rustogi or vice versa," said Singh.
MiD DAY tried to contact India Infoline Executive Director R Venkataraman but despite repeated attempts, Venkataraman did not speak to us.
He sent us an SMS saying he would contact us later. Till the time of going to press, there was no clarification.
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'One more fraud'
The Rustogis are not alone.u00a0
Pravesh Rawat, a resident of Gurgaon, Sector-14, and a management student, has accused India Infoline of trading in his account without his knowledge.
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In his complaint to the Securities and Exchange Board of India (SEBI), Rawat has alleged that shares worth Rs 15,000 from his account were sold off by India Infoline on May 13 and May 15, 2009.
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"I received a contract note from India Infoline informing me about a trading that had been done in shares I hold on May 13. I was shocked as I had not asked them to trade in my account.
There was another trading done on May 15 without my permission. I spoke to the company's relationship manager in Gurgaon, Tarun, and he accepted it was a mistake.
He assured me things would be worked out. They even called me to their office to discuss the issue," said Rawat.
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Meanwhile, Rawat recorded the alleged telephonic conversation between him and Tarun, during which the latter accepts to have committed a mistake.
In the tape, a copy of which is with MiD DAY, Rawat alleges the relationship manager of trading in his account "without permission" and the latter does not deny the accusation but only calls him to his office.
When contacted, Tarun said he would get back to us later.
They say...
MiD DAY tried to contact India Infoline Executive Director R Venkataraman but despite repeated attempts, Venkataraman did not speak to us.
He sent us an SMS saying he would contact us later. Till the time of going to press, there was no clarification.
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