IPS Dr Ravindra Patel Pays Rs72.80 Lakh, Disgorges Rs1.90 Crore To Settle Sadhna Broadcast Stock Manipulation Case

Moneylife Digital Team 28 February 2025

Investor Interest

In a recent settlement with the Securities and Exchange Board of India (SEBI), Ravindra Dahyabhai Patel, an officer from the Indian Police Service (IPS) cadre, agreed to pay a settlement amount of Rs72.8 lakh and disgorge Rs1.90 crore in profits. This resolution addresses allegations of his involvement in manipulating the share prices of Sadhna Broadcast Ltd by disseminating misleading information through YouTube videos.

The case originated between July and September 2022, when SEBI received complaints about potential price manipulation and the subsequent offloading of shares in Sadhna Broadcast. Investigations revealed that certain net sellers of the company's shares were connected to creators of YouTube channels that published videos containing false content and unrealistic target prices for the stock. These videos were designed to influence and induce public investors to invest in the scrip. Following these findings, SEBI issued an interim order in March 2023, prohibiting 31 entities from participating in the securities market.

As part of the settlement, Mr Patel has also agreed to a voluntary debarment, refraining from buying, selling, or dealing in securities for a period of six months.

This case highlights the growing influence of social media platforms in financial markets and the potential risks posed by misleading information disseminated through such channels.

In March 2023, while impounding alleged illegal gains worth Rs41.85 crore earned from manipulating Sadhna Broadcast scrip, the market regulator barred till further orders 31 entities, including Bollywood actor Arshad Warsi and his wife, Maria Goretti. SEBI found false and misleading videos uploaded on two YouTube channels recommending investors buy Sadhna scrip to earn extraordinary profits.

However, certain promoter shareholders, key management personnel (KMPs) of Sadhna, and non-promoter shareholders who held more than 1% of the shareholding in the company offloaded a significant part of their holdings at inflated prices and booked profits.

In an order, Ananth Narayan G, whole-time member (WTM) of SEBI says, "The factual matrix leads me to conclude that these noticees bear a higher and overall liability for the alleged fraudulent scheme which resulted in a gain for them at the cost of several thousand small investors who entered the scrip of Sadhna at artificially inflated prices. The observations also prima facie suggest that these noticees were effectively the orchestrators and ultimate beneficiaries of the alleged fraudulent scheme."

According to media reports, Dr Ravindra Patel currently serving in a senior position in the Gujarat police, hails from an influential family with deep-rooted connections in the police force. His father, DN Patel, is a well-known IPS officer from Gujarat retired as an inspector general (IG).

SEBI asked these 31 noticees to disgorge illegal gains worth Rs41.85 crore earned through the stock manipulation in an interest-bearing escrow account with a lien marked in favour of the market regulator. (Read: Arshad Warsi, Wife among 31 Barred from Markets for Manipulating Sadhna Broadcast Scrip via 2 YouTube Channels)

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