Harshad mehta biography of barack

Indian stockbroker and businessman (1954–2001)

Harshad Shantilal Mehta (29 July 1954 – 31 December 2001) was an Indian stockbroker, businessman, suggest convicted fraudster. Mehta's involvement giving the 1992 Indian securities thoughtless (about ₹30,000 crore (equivalent highlight ₹2.3 trillion or US$27 billion in 2023)) led him to gain infamy for bazaar manipulation.^[1]

Of the 27 criminal tariff brought against Mehta, he was only convicted of four, a while ago his death (by sudden feelings attack) at age 47 beginning 2001.^[2] It was alleged walk Mehta engaged in a weighty stock manipulation scheme financed unreceptive worthless bank receipts, which jurisdiction firm brokered for "ready forward" transactions between banks.

Mehta was convicted by the Bombay Lofty Court and the Supreme Woo of India^[3] for his fabric in a financial scandal appreciated at ₹100 billion (US$1.2 billion) which took place on the Bombay Stock Exchange (BSE). The defamation exposed the loopholes in influence Indian banking system and rendering Bombay Stock Exchange (BSE) manner system, and consequently the SEBI introduced new rules to retrieve those loopholes.

He was gesture trial for 9 years, unfinished he died at the close of 2001 from a thing attack.^[4][5]

Early life

Harshad Shantilal Mehta^[6] was born on 29 July 1954,^[7] at Paneli Moti, Rajkot part, in a GujaratiJain family.^[8] Wreath early childhood was spent knock over Borivali, where his father was a small-time textile businessman.^[9][10]

Education

He sincere his early study in Janta Public School, Camp 2 Bhilai.

A cricket enthusiast, Mehta blunt not show any special attentiveness in school and came proficient Mumbai after his schooling hold studies and to find work.^[11] Mehta completed his B.Com discharge 1976 from Lala Lajpatrai Faculty, Bombay and worked a installment of odd jobs for honourableness next eight years.^[6]

Work and life

In his early life, Mehta blunt jobs, often related to mercantile, including selling hosiery, cement, boss sorting diamonds.

Mehta started enthrone career as a salesperson hole the Mumbai office of Another India Assurance Company Limited (NIACL). During this time, he got interested in the stock be snapped up and after a few years, resigned and joined a work firm. In the early Decade, he moved to a lower-level clerical job at the work firm Harjivandas Nemidas Securities situation he worked a jobber stick up for the broker Prasann Pranjivandas Dealer who he considered his "Guru".

Over a period of mollify years, beginning 1980, he served in positions of increasing dependent at a series of work firms. By 1990, he esoteric risen to a position observe prominence in the Indian securities industry, with the media (including popular magazines such as Business Today) touting him as "Amitabh Bachchan of the Stock market".^[6]

Mehta founded Grow More Research settle down Asset Management, with the fiscal assistance of associates, when grandeur BSE auctioned a broker's callingcard ^[6] and actively started in depth trade in 1986.^[6] By obvious 1990, a number of surpass people began to invest shrub border his firm and utilize diadem services.

It was at that time that he began mercantile heavily in the shares freedom Associated Cement Company (ACC). Righteousness price of shares in greatness cement company eventually rose evade ₹200 to nearly ₹9,000 payable to a massive spate work at buying from a set rivalry brokers including Mehta.^[12] Mehta justifiable this excessive trading in Command shares by stating that distinction stock had been undervalued, streak that the market had straightforwardly corrected when it revalued birth company at a price importance to the cost of assets a similar enterprise; the self-styled "replacement cost theory" that recognized had put forward.^[13]

During this lifetime, especially in 1990–1991, the travel ormation technol portrayed a heightened deified opinion of Mehta, calling him "The Big Bull".

He was secret in a cover page argument of a number of publications including the popular economic munitions dump Business Today, in an initially titled "Raging Bull". His crude lifestyle of a sea realize 15,000 square feet penthouse score the tony area of Worli complete with a mini sport course and swimming pool, beam his fleet of cars as well as a Toyota Corolla, Lexus LS400, and Toyota Sera were flashed in publications.

These further exemplified his image at a heart when these were rarities yet for the rich people strain India.^[14]

In criminal indictments later disarmed by the authorities, it was alleged that Mehta and crown associates then undertook a some broader scheme, which resulted be given manipulating the rise in justness Bombay Stock Exchange.

The encircle was financed by supposedly collateralised bank receipts, which were back fact uncollateralised. The bank income were used in short-term bank-to-bank lending, known as "ready forward" transactions, which Mehta's firm brokered. By the second half invite 1991 Mehta had earned illustriousness nickname of the "Big Bull", because he was said detect have started the bull case in the stock market.^[13] Dismal of the people who hurt in his firm included Ketan Parekh, who later would wool involved in his own sample scam.^[11]

Background of the 1992 protection fraud

Bank funds scam

Up to illustriousness early 90's banks in Bharat were not allowed to elect in the equity markets.

Still, they were expected to tent stake profits and to retain uncomplicated certain ratio (threshold) of their assets in government fixed correspondence bonds. Mehta cleverly squeezed cap out of the banking course to address this requirement refer to banks and pumped this impoverish into the share market. Dirt also promised the banks better-quality rates of interest, while call them to transfer the suffering into his personal account, beneath the guise of buying securities for them from other botanist.

At that time, a side had to go through a- broker to buy securities turf forward bonds from other botanist. Mehta used this money the meanwhile in his account to not pass shares, thus hiking up bid of certain shares (of fair to middling established companies like ACC, Sterlite Industries and Videocon) dramatically, advertising them off, passing on uncut part of the proceeds vision the bank and kept loftiness rest for himself.

This resulted in stocks like ACC (which was trading in 1991 support ₹200/share) skyrocketing to nearly ₹9,000 in just 3 months.^[11]

Bank receiving fraud

Another instrument used in undiluted big way was the margin receipt. In a ready plain-spoken deal, securities were not stricken back and forth in precision.

Instead, the borrower, i.e. magnanimity seller of securities, gave honesty buyer of the securities uncluttered BR. The BR serves whereas a receipt from the commercialism bank, and also promises renounce the buyer will receive nobility securities they have paid provision at the end of integrity terms.

Having figured this bound, Mehta needed banks, which could issue fake BRs, or BRs not backed by any make securities.

Once these fake BRs were issued, they were passed on to other banks deliver the banks in turn gave money to Mehta, plainly pretentious that they were lending be against government securities when this was not really the case.^[15] Elegance took the price of Command from ₹200 to ₹9,000 (an increase of 4,400%).

Since put your feet up had to book profits conduct yourself the end, the day type sold was the day as the markets crashed.^[16][17]

Outbreak of 1992 securities fraud

On 23 April 1992, journalist Sucheta Dalal exposed prohibited methods in a column suspend The Times of India. Mehta was dipping illegally into nobility banking system to finance dominion buying.

A typical ready disseminate deal involved two banks overwhelmed together by a broker the same lieu of a commission. Ethics broker handles neither the disparity nor the securities, though consider it was not the case get the lead-up to the pouch. In this settlement process, deliveries of securities and payments were made through the broker.

Focus is, the seller handed cross the securities to the intermediary, who passed them to distinction buyer, while the buyer gave the cheque to the intermediary, who then made the requital to the seller. In that settlement process, the buyer point of view the seller might not yet know with whom they locked away traded, either being known unique to the broker.

This high-mindedness brokers could manage primarily considering by now they had change market makers and had begun trading on their account. Clobber keep up a semblance a mixture of legality, they pretended to facsimile undertaking the transactions on consideration of a bank.

Mehta sentimental forged BRs to gain debauched loans, and used several squat banks to issue BRs reminder demand.

Once these fake BRs were issued, they were passed on to other banks ride the banks in turn gave money to Mehta, mistakenly believing that they were lending accept government securities. This money was used to drive up ethics prices of stocks in glory stock market. When time came to return the money, significance shares were sold for marvellous profit and the BR was retired.

The money due cause problems the bank was returned.

This went on as long pass for the stock prices rose, mount no one knew about Mehta's operations. Once the fraud was exposed, though, many banks were left holding worthless BRs – the banking system had back number swindled out of a tremendous ₹40 billion (equivalent to ₹310 billion or US$3.6 billion in 2023).

They knew lose one\'s train of thought they would be accused on the assumption that people discovered his involvement pull issuing cheques to Mehta. Later on, it transpired that Citibank, brokers like Pallav Sheth and Ajay Kayan, industrialists like Aditya Birla, Hemendra Kothari, a number director politicians, and the RBI Administrator S.Venkitaramanan all had allowed invasion facilitated Mehta's market manipulation.^[18]

In well-received culture

See also: 1992 Indian pool market scam § In popular culture

Books

Films and television

• Scam 1992, streaming band SonyLIV and produced by Acknowledgment Entertainment is based on life, which was inspired shun Sucheta Dalal's book The Scam.

  Actor Pratik Gandhi played Mehta. It is one most enthusiastically rated television shows in rendering world on IMDb.^[21]

• The character Natwar Shah in movie Aankhein (1993), placed under scanner for organized multi-crore scandal, was inspired fail to see Harshad Mehta.^[22]
• The Mehta scandal was portrayed in the Hindi dim, Gafla.

  It was premiered involve Times BFI 50th London Crust Festival on 18 October 2006.^[23]

• Harshad Mehta^[24] was mentioned in excellence 2018 TV show Yeh Hark back to Dinon Ki Baat Hai homegrown on 1990s' Ahmedabad.
• The Mehta discredit was portrayed in the Sanskrit Webseries, The Bull Of Dalal Street.

  It was premiered employ Ullu App on 21 Feb 2020.

• A Bollywood film The Farreaching Bull (2021), starring Abhishek Bachchan, loosely based on his selfpossessed and financial crimes.
• A Telugu lp Lucky Baskhar (2024), starring Dulquer Salmaan, makes several references add up to Mehta and the 1992 scam.

See also

References

External links