After the Harshad Mehta case, the Ketan Parekh 2001 Scam was the second most significant incident to shock the Bombay Stock Exchange. Ketan Parekh earned a 200% yearly return on some equities when he was thought to be single-handedly driving the stock market.
The Indian stock market was unexpectedly making headlines throughout the world. It was later revealed that broker-turned-operator Ketan Parekh was driving the market. He would take the market by storm, increasing or lessening the stock values immediately by abruptly releasing large amounts of money into the market. After a splashy start, his trade was cut short when he got entangled in the infamous stock market scam known as the “Ketan Parekh and the K-10 stock scam.”
He suffered a noteworthy hit to his appearance, but we’ll cover other facts concerning The truth of Ketan Parekh’s stock market fraud that isn’t often mentioned to the public.
Ketan Parekh has a cover story to explain his infamous actions and mislead critics. He was believed to support the Information, Communication, and Entertainment (ICE) industry. Considering that the late 1990s and early 2000s were the years of the IT boom, and these stocks were increasing by leaps and bounds worldwide.
As a result, the stocks Ketan Parekh selected rose in value. As a result, his significant 200% increase in shares was not as remarkable and did not garner as much notice as Harshad Mehta’s exploits.
The Infractions:-The problem with Ketan Parekh’s trades was twofold:- First, he accepted capital from the advocates of several firms to raise their share prices. This is considered insider trading and was enough to risk Ketan Parekh severely.
To add abuse to injury, Ketan Parekh had also swiped substantial sums of money from the Madhavpura Mercantile Commercial Bank (MMCB). He was suspected of bribing bank officials to convince them to lend against shares to a higher degree than authorized by law.
The Fallout:- Ketan Parekh also traded most of his stocks on the Calcutta stock exchange (CSE). The lack of restriction in this deal gave Mr. Parekh additional freedom. He did not trade on his account but authorized other brokers to hold shares on his behalf and paid them a commission for doing so while covering any losses they could have had on the transaction.
He readily confessed to his collapses and compensated the majority of his lenders. For over the last 2 decades, Ketan is doing the suitable thing because he believes in the Indian judiciary. Ketan’s reputation has been defeated, yet few know his genuine path.
Ketan learned to trade from his father, who was also his role model. Ketan created a niche through detailed planning, market study, and in-depth knowledge. He devoured plenty of time investigating businesses, their techniques, and their potential.
It is worth noting that, unlike lawbreakers, he did not flee the country despite having the means to do so. He did not renounce his faith or pursue political shelter in other countries. Instead, he stayed and suffered the outrage of our legal system.
Everyone deserves a second start, especially if they have attempted to make things right and followed the laws.
His goodness and compliance with the law must be emphasized. He is, however, still misunderstood, and any charges leveled against him even 20 years ago are still linked to his name.