[Resolved]  Sharekhan Limited — Huge loss of capital in form of shares due to misleading information given by my stock broking agency SHAREKHAN Limited

Subject: Loss of capital in form of shares due to misleading information given by my stock broking agency SHAREKHAN Limited whose Registered Office is located at: A-206, Phoenix House, Phoenix Mills Compound, Senapati Bapat Marg, Lower Parel, Mumbai- 400013.

Dear Sir/ Madam,

My name is Vinay Shrivastava, a customer of Sharekhan Limited & having a customer id 795788, DOB October 11, 1976 & Address A-701, Bheem, NL Complex, Dahisar (E) Mumbai- 400068.

I purchased 515 shares of Indiabulls Real Estate on 6th Jan 2009 & 85 more shares of the same company on the next day i.e. 7th Jan 2009 against the margin buy order. I was having a cash balance of 28792 INR & since Sharekhan provides the margin order facility up to 4 times to its customer, I had bought total 600 shares of Indiabulls Real Estate against margin buy order. Average price of these bought shares was around 157 INR & margin money provided by Sharekhan was around 66000 INR.

However the very next day due to SATYAM scandal, market fell down and price of this share went down to 100 INR, later it closed above 117. I wanted to take a delivery of these 600 Indiabulls Real Estate shares, so I called up Sharekhan’s Customer care on[protected]. They informed me that I can take the delivery up to next 4 days of buying the shares against a margin buy order, they say it a cycle of Margin Buy Settlement of Fund at T+4 working days where T is the date when we purchased the shares. In case a customer is not able to arrange the requires additional margin money on the fifth day of buying these shares against a margin buy order, Sharekhan automatically squares off the holdings to collect its margin money & leave rest of the remaining shares if available after the deduction. I understood it & made up my mind to take the delivery if price doesn’t reach up to 145 or 150 in the next 4 days of buying the shares. For that I had the arrangement of money from some of my Bank’s Credit Cards which was not a big issue then.

On T+3rd day I again called up Sharekhan’s Customer Care in the morning before opening the market, and they confirmed the same and clearly told me about the availability of my 600 shares till the evening session of T+4th day i.e. up to 15:30 IST on 13th Jan 2009. I was assured that if your share’s price doesn’t comes up, you can take the delivery of these shares up to T+4th day before closing by depositing remaining amount of 66000 INR, which I agreed.

To my utter disbelief when I logged on at Sharekhan’s Terminal using its software, I found that Sharekhan had already sold off my 493 shares without the prior intimation or informing me & that too at a very low price of 111.55 INR. It was horrifying as it wiped out my entire money & I had no option then apart from selling off my remaining 107 shares also in a hurry as the large chunk of my shares had already been sold off & I was already in a huge loss.

I immediately contacted Sharekhan’s Customer Care & they told me if market goes negative we sell it off to recover our money & to minimise our risk exposed. I asked them if they give any prior information, they replied no we don’t have such a policy. When I again asked the representative as to why didn’t you squared off when it went below 96 yesterday & what is the reason of doing this when it is on a much higher price then yesterday, she was unable to answer my queries. I had no option then.

I lost my 28792 INR because of the misleading information given by Sharekhan’s Customer Care & I want to file a complaint for the compensation of my loss and mental torture which I have gone through since then. I want back my entire share holdings which they sold off without intimating me & I even want to take a delivery of these 600 shares.

Basis of my complaint are as below:

1) I was in regular touch with Sharekhan’s representatives since I had purchased the 600 shares against the margin order. My mobile company can provide all the call details with their numbers & usually call centres keep their customer’s log of conversation for the records. Same can be verified with them as to what I asked and how I was replied.

2) Even if they feel that market is dipping and it is the time to sell off their holdings to minimise the risk which is exposed, they should have tried to make a call on my mobile or landline numbers, but they did it without any prior information or intimating the customer via telephone, email or even a SMS. That is a issue of negligibility & irresponsibility by its officers which I want to raise before the CONSUMER FORUM.

3) Representatives of Sharekhan didn’t told me even once that under some special clause my shares can be squared off, instead they kept telling me about the availability of remaining days for the fund arrangement which was T+4 according to them. This is a case of loss due to misleading information provided by its representatives.

4) I was ready to take the delivery that is why I was calling to its customer care repeatedly, My intentions were clear about that & that can be again verified with the call logs. In spite of taking all the precautions I met with the huge losses & Sharekhan is clearly at fault.

5) I can provide all the trade details & other details if required.
I want the Sharekhan to be penalised for this act, a compensation of 2, 00, 000 INR is requested for this irresponsible act & mental torture due to this, with the readiness of taking the delivery of my 600 Indiabulls Real Estate shares at any time, on the same rate at which I had placed an order to buy them.

Personal Details:

Name: Vinay Shrivastava
Address: A-701, Bheem, NL Complex, Dahisar (E) Mumbai- 400068.
Phone: [protected], [protected], [protected]
Customer ID: 795788
Date of Birth: October 11, 1976