Asking Karvy-DP not to open fresh accounts till further notice, the Securities and Exchange Board of India has found that 95 per cent of the fictitious and 'benami' demat account holders in the Yes Bank and IDFC IPO scams were with Karvy.
It was found that the account opening forms of almost all the demat accounts opened by Karvy DP in fictitious and benami names had letters purportedly issued by Bharat Overseas Bank and Vijaya Bank towards proof of identity (POI) and proof of address (POA), Sebi said in its interim order.
During the course of verifications by Sebi with these banks, it was found that the savings bank accounts indicated in the demat accounts held in fictitious or benami names did not exist, the market regulator said.
Also, the branch managers of the banks concerned denied having issued any such bank letters towards POI and POA indicating the bank account number, Sebi found.
In view of the non-existence of the savings bank account with the bank's branches and the denial from the branch managers, it is evident that the bank letters based on which Karvy DP had opened thousands of demat accounts is fraudulent and fabricated, the market regulator said.
It is seen that the contents of the fabricated bank letter like name of the applicant, address exactly matches with the data available on the depositories system, indicating that the details for the fabricated bank letters have been picked up from the depository system and then printed on the bogus bank letterhead, Sebi said.
Pointing out that the data entered in the depository system is available only to the depository or the DP concerned, the market regulator said the fabrication of the bank documents is possible only with the connivance of the depository.
