Indiabulls: Analyst sought bribe to stop ‘Sell’ report

Indiabulls had termed the allegations as factually incorrect and as an intentional act of profiteering.

Written by ENS Economic Bureau | Mumbai | Published: August 9, 2012 9:56:06 pm

A day after based Veritas Investment Research released a report recommending investors sell shares of diversified group Indiabulls saying it had sacrificed corporate governance to enrich its controlling shareholders,Indiabulls Thursday alleged that the author of the report had demanded $40,000-$50,000 to hold it back and a police complaint had been filed.

In the report titled ‘Bilking India’,Veritas advised institutions and individuals to sell all Indiabulls Group stocks saying that corporate governance has been sacrificed to enrich controlling shareholders. Indiabulls had termed the allegations as factually incorrect and as an intentional act of profiteering. But the report caused share prices of Indiabulls Group companies to tank by around 10 per cent on Wednesday before recovering later during the day.

On Thursday,in a statement filed with the Bombay Stock Exchange,Indiabulls Real Estate said that Indiabulls had filed a complaint against the “malafide Veritas report along with an email evidence where Neeraj Monga has demanded money through his personal email and that if monies are given in time then he would hold back the report”. Monga is executive vice-president and head of research at Veritas.

A source close to the development told The Indian Express that Monga had allegedly demanded the money through an email which had been submitted to Gurgaon police where the complaint was filed. The alleged email,however,was not sent to Indiabulls.

“The email demanding money was sent by Monga from his personal email to a large SEBI registered FII on August 7,2012,only a day before the report was made public,” the source claimed.

The Indiabulls statement to the BSE said that Monga,his co-author Nitin Mangal and Veritas Research had been booked under various laws relating to extortion and forgery,among others. While Veritas does not have an office in India,Indiabulls has also complained against Veritas Research Corporation and their accomplices to the other investigating agencies in Canada for causing harm and injury to Indiabulls companies and its shareholders.

The company also alleged that the authors of the report never spoke to anyone at Indiabulls for any clarifications or facts and have never visited any of its power plants or real estate sites before releasing their report.

There was no response from Monga to an email sent by The Indian Express seeking his comment.

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