MUMBAI, APR 28: The Investors Grievances Forum (IGF) has filed a writ petition in the High Court demanding investigation into vanishing and fraudulent companies and arrest of their promoters.IGF has said the SEBI, stock exchanges and other government institutions have not taken up the matter seriously regarding the increasing number of vanishing and fraudulent companies. SEBI has been able to provide the names of only 80 companies which have vanished till today. ``However, nearly 3,500 companies have vanished with Rs 20,000 to 25,000 crore of the investors money,'' IGF has said.The petition has mentioned the SEBI, Ministry of Finance, Department of Company Affairs, Ministry of Law, Registrar of Companies, Company Law Board, Bombay Stock Exchange and others as respondents.IGF said about 705 companies in the last 4 years have not paid the fees and their names have been delisted by the BSE. ``Nearly 600 companies have changed their names and 1,000 companies have changed their registered offices or theirshare transfer agents. These figures are just a representation of what is prevailing in today's market. Changing names frequently and amassing crores of rupees has benefitted the fraudulent promoters but the investors have suffered a lot,'' it said.``The promoters deliberately use such modus of operandi with an intention of not complying with the rules and regulations after the company is formed. Such companies are either not traceable and/or have eroded with the share holders life savings,'' IGF said. Nearly 34 companies have changed their names synonymous to software companies. These names were changed to fascinate and lure the investors to invest in software companies, the prices of which were rising. ``The ultimate aim behind all this is just to cheat the small investors,'' it said.``SEBI is just going on taking complaints, without taking any action against the fraudulent companies. It has kept its fingers crossed. It has given clearance to many companies without going into the depth and verifyingthe status of the promoters. Department of Company Affairs and the Registrar of Companies have not taken pains in checking the activities of companies, or haven't kept a check on the operation of the companies. A proper system has not yet been chalked out to find as to where the fund goes after it has been raised through public issues,'' IGF said.IGF, in its petition, has demanded investigation into the affairs of such vanishing companies and arrest of their promoters and group concerns. ``Stock exchange listing agreement should contain a condition that no listing of new companies should be permitted in the case of promoters of delisted companies. CBI inquiry and investigation should be completed within a specified period. The SEBI should restrain companies coming out with public issues at the premium exceeding 30 per cent of its face value,'' IGF demanded.
