SEBI-EoW busted Dabba trading scam worth Rs 2,500 crores

• The cops have conducted raids at 10 different locations
• More than 10 businessmen arrested for running illegal share brokerage network

By Dheeraj Fartode

In a major crackdown against Dabba traders (illegal share brokers) in city, joint teams of Securities and Exchange Board of India (SEBI) and Economic Offences Wing (EoW) on Thursday conducted raids at nine city based business establishment and arrested 10 businessmen in this connection. The EoW have seized Rs five lakh cash along with many diaries, computers from the traders in which entries of share trading is available. The business establishments have collectively turn over worth Rs 2,500 crore per year, claimed an EoW official.

According to information, the unnoticed scam in all these years came to fore after a written complaint received by EoW last month. During investigation of the complaint, the EoW contacted SEBI officials and discussed the case. The joint team of SEBI and EoW discovered huge amount of Dabba trading in city. 

Add caption

The SEBI and EoW officials decided March 12 as ‘D’-Day for line of action to bust the illegal share brokerage network. On Thursday at 7 am, the EoW have registered an offence against Dabba trader Kushal Kishor Laddhadh (36), a resident of 501, Siddhivinayak Apartment, Dagadi Park, Ramdaspeth and Vina Ghansham Sarda (51), a resident of Sharda House, Cement Road, Shivaji Nagar. Laddhadh had floated SK Investment company at Shriwardhan complex after getting sub-brokership from JCL Securities PVT Ltd.

After registering the offence, the joint teams from Nagpur Crime Branch office move for nine targets at different locations at 10 am. The joint teams have conducted raids Shriwardhan complex, Ramdaspeth, Gandhibagh, Telephone exchange square, Dr Ambedkar square Lakadganj and Shivaji Nagar. 

An EoW official informed The Hitavada the proprietors along with their employees were busy in share trading when the cops entered in the business houses. The cops have immediately arrested the accused and seized computers, laptops, diaries with entries. 

The arrested accused are identified as prime accused Ravi Agrawal proprietor of L7 group, near Mascot Honda, Telephone Exchange square; Kushal Kishor Laddhadh (36), a resident of 501, Siddhivinayak Apartment, Dagadi Park, Ramdaspeth and proprietor of SK Investment, Shriwardhan Complex, Tandapeth; Pritesh Sureshkumar Lakhotia (37), a resident of Indu Narayan Apartment, Shankar Nagar and propritor of Atharva Securities, Gandhibagh; Gopi Malu, proprietor of JK Investment, at basement of Jagat chambers, Dr Ambedkar Square, Lakadganj; Abhishek Bajaj, Honey apartment, first floor, near Somani trading corporation, Dr Ambedkar Square, Lakadganj; Sachin Agrawal, near Nagpur Nagarik Bank, Dr Ambedkar Square, Lakadganj; Kanni Thawrani, near TVS showroom, first floor, Telephone Exchange square, Lakadganj; Dinesh Gokhlani, office at Telephone Exchange square; Vina Ghanshyam Sarda (51), a resident of Sharda House, Cement Road, Shivaji Nagar. 

Police have booked the accused under Sections 409, 420, 120 (B) of Indian Penal Code read with Sub-section 23 (1) of Securities Contract Regulation Act 1956. 

Under the guidance of Commissioner of Police (CP) Sharda Prasad Yadav, Joint CP Rajvardhan, DCP (EoW) Deepali Masirkar, API Pradip Lande, PI R S Patil, PI Fulpagare, PI Madane, PI G J Patil, PI Sanap, PI Chougule, API Atulkar, PI Kalange, WAPI Jaipurkar and others were made the arrest. 

Thousands of City Bizmen are customers 

An EoW official informed that thousands of city businessmen are regular customers of the Dabbar traders. They had invested black money in the trading so that they have no tax liabilities. “Everyday, a trader booked transactions of Rs 50 lakh on phone calls just like cricket betting bookites,” an official said. The diaries seized by the eon have phone numbers of many big buissesmen of the city. They have booked profits of crones of ruppes in last five years and they would face police action during the investigation. 

What is Dabba trading? 

An eon official informed that ‘Dabba’ means box and a Dabba operator is the one who indulges in Dabba trading. The arrested Dabba traders have another business in the Mahal, Gandhibagh and Itwari area of the city. After setting up office in the market area, they started selling and purchasing of shares. The traders that take place are never executed in the stock exchange. All the trades are executed only on the diaries or computers of the Dabba trader. “They are just another copy of cricket betting bookies,” said an eon official. All these traders works under various agent who have connections in Mumbai and Gujarat. 

L7 group the biggest player

Sources informed that Ravi Agrawal, proprietor of L7 group is the prime accused in the case. All the Dabba traders were operating under Ravi Agrawal. He had connection with stock brokers operating from Mumbai and Dubai. Many Dabba traders of Bhopal, Indore, Jabalpur, Raipur are also working under Agrawal’s guidance. Ravi Agrawal used to manage movement of a particular targeted stock to book the profit. Agrawal have amassed wealth worth rupees thousands of crore. He had invested money in the reality market of Nagpur and Mumbai too, an EoW official told The Hitavada.