Below is the corruption/ Controversy cases and scams in the Indian stock market:
1. Harshad Mehta Scam (1992)
Harshad Mehta exploited loopholes in the banking system to artificially inflate stock prices. Using fraudulent cheques and market manipulations, he orchestrated a scam worth approximately ₹5,000 crores, caused a massive crash in the Indian stock market.
2. Ketan Parekh Scam (2001)
Ketan Parekh manipulated the prices of select stocks, known as “K-10 stocks,” using funds borrowed from banks like the Madhavpura Mercantile Cooperative Bank. The scam caused severe market fluctuations and led to losses for small investors.
3. Satyam Computers Fraud (2009)
Ramalinga Raju, the founder of Satyam Computers, falsified the company’s financial statements by over ₹7,000 crores. This exposed gaps in corporate governance and investor protections. This fraudulent accounting led to a loss of trust among investors in corporate governance.
4. IPO Scam (2005-2006)
Fraudsters manipulated Initial Public Offerings (IPOs) using thousands of fake demat accounts, preventing genuine investors from receiving fair allotments.
5. Adani Controversy (2024)
Hindenburg Research accused Adani Group companies of stock manipulation and fraudulent accounting practices. This triggered a significant fall in the Adani Group’s market value and raised questions about regulatory oversight.
https://www.business-standard.com/companies/news/how-sec-s-adani-indictment-differs-from-hindenburg-s-fraud-allegations-124112100303_1.html
These situations show the urgent need for strong rules and better awareness among investors to reduce corruption in the stock market.
