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ED sends 'opportunity notices' to 20 FIIs

The Enforcement Directorate here has served 'opportunity notices' on 20 foreign institutional investors under Section 61 of the Foreign Exchange Regulations Act for alleged violation of Reserve Bank of India guidelines.

The notices were served on the FIIs, most of which are based in the US and UK with sub-accounts in Mauritius, last week for alleged violation of RBI guidelines in respect of private placement of shares of Himachal Futuristic Communication Ltd, in which Shankar Sharma owned First Global was the sole book runner.

The directorate has already filed a complaint against Sharma for re-selling of HFCL shares to FIIs without RBI permission.

"It is a step before filing prosecution cases against them to find out whether they had the required RBI permission," an ED official said in Mumbai on Wednesday.

Declining to reveal further details, the official said, "some FIIs have already replied to our notices" and added that prosecution cases would be filed at the chief metropolitan magistrate's court in Mumbai before May 31 as Foreign Exchange Management Act comes into effect from June 1.

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