India: SEBI Imposes Trading Restrictions on Suspected Shell Companies

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August 8 2017

India imposed trading restrictions on 162 listed entities identified as shell companies, a surprise move that analysts said was part of a broad crackdown on illegal offshore transfers and tax evasion.  The announcement by the Securities Exchange Board of India (SEBI) late on Monday did not say what illegal activities the companies may have been engaged in. The restrictions include limiting trading in the affected companies to once a month and curbs in the trading of shares held by the promoters and directors of the companies.

The government has been going after companies it suspects of engaging in irregular transactions after a ban on high-value currency bills late last year, including transferring money abroad illegally, or “black money,” and evading taxes.