'Harshad Mehta era is returning', industrialist Harsh Goenka warns small investors

RPG Group Chairman and famous industrialist Harsh Goenka has expressed fear of irregularities in the stock market. He warned that small investors may have to suffer huge losses due to this disturbance. Harsh Goenka warned that the boom being seen in the stock market could be due to the return of the rigging that took place during the era of Harshad Mehta and Ketan Parekh.

Harsh Goenka also claimed that irregularities are being committed from Kolkata and a nexus of Gujarati and Marwari brokers is working in it. Harsh Goenka wrote in a post shared on social media that 'The Harshad Mehta/Ketan Parekh era is making a comeback with the rapidly rising stock market and all this is happening especially from Kolkata. The promoters are increasing profits (through profit entry) and the nexus of Gujarati-Marwari brokers is driving stock prices to unrealistic levels. This can cause huge losses to small investors. The time has come for SEBI and the Finance Ministry to intervene and investigate this before small investors suffer losses.

According to media reports, after Harsh Goenka's tweet, a decline was also seen in the stock market on Saturday and the stock market reached below the 74 thousand mark. At the same time, NSE Nifty also saw a fall of more than 200 points. However, many traders say that some media reports claimed that the new government may make changes in the income tax system after the Lok Sabha elections, due to which the market fell. However, Finance Minister Nirmala Sitharaman rejected these claims outright and said that these are just rumors.

In the 90s, India's stock market was shaken by the scam committed by Harshad Mehta. Harshad Mehta was an ordinary stock broker in the Bombay Stock Exchange who rigged the stock market by taking advantage of loopholes in the country's banking system. Harshad Mehta fraudulently increased the price of selected shares. For this, Harshad Mehta raised money on hundi from government banks and used it to increase the price of shares. Due to this, there was a rush among people to buy these shares and this led to a huge increase in the Bombay Stock Exchange. Later, when the fraud was revealed, investors had to suffer huge losses. SEBI was formed only after this scam. Nearly ten years after the Harshad Mehta scam, Ketan Parekh was also accused of a similar scam.