Police arrests CEO, CFO of scam-hit Karvy in IndusInd Bank default case

The city police on Thursday arrested two senior executives of scam-hit Karvy Stock Broking Pvt Ltd for allegedly involving in diverting funds raised from banks by pledging clients' securities as collaterals.

According to a police press release, Rajiv Ranjan Singh, Chief Executive Officer and G. Krishna Hari Chief Financial Officer of Karvy were arrested basing on a complaint by IndusInd bank.

The police had earlier arrested C Parthasarathy, chairman of Karvy, on charges of defaulting a loan to the tune of Rs 137 crore to IndusInd Bank.

In November 2019, SEBI barred KSBL from taking new brokerage clients after it was found that the brokerage firm had allegedly misused clients' securities to the tune of over ?2,000 crore.

In November 2020, Bombay Stock Exchange declared Karvy Stock Broking as a defaulter and removed the brokerage house from its membership after a similar action was initiated by the National Stock Exchange.