Ketan Parekh SCAM💀: Things Hidden from You! | Ketan Parekh Scam Explained | Harsh Goela

Summary

The video script narrates the rise and fall of Ketan Parekh, a stockbroker inspired by Harshad Mehta, who orchestrated the second-largest scam in Indian stock market history. Operating under the radar, Parekh manipulated stocks through strategies like pump and dump and circular trading, involving institutional investors and promoters. His low-profile lifestyle and choice of the Calcutta Stock Exchange aided his operations. However, the dot-com bubble burst exposed the scam, leading to massive losses for retail investors and the collapse of banks involved, ultimately revealing a fraud estimated at 40,000 crores.

Takeaways

• 🚀 Ketan Parekh was inspired by Harshad Mehta and learned from his strategies to manipulate the stock market.
• 💼 Ketan Parekh started his career in his father's stockbroking business and later became a CEO.
• 🤝 He had good connections with businessmen, actors, and politicians, which he used to his advantage.
• 📉 The Harshad Mehta Scam in 1992 was a major event that influenced Ketan Parekh's approach to stock market manipulation.
• 🏦 Ketan Parekh used bank receipts and pay orders to create an illusion of credibility and secure large loans.
• 📈 He targeted small businesses with low market capital and high future prospects, particularly in the IT and telecom sectors.
• 📉 His strategies included 'pump and dump' and 'circular trading' to artificially inflate stock prices and then sell for profit.
• 💸 Ketan Parekh involved institutional investors and promoters in his schemes, leveraging their influence and capital.
• 📉 The dot-com bubble burst and subsequent crisis in 2001-2002 led to the downfall of Ketan Parekh's manipulation scheme.
• 💸 It is estimated that the Ketan Parekh scam amounted to a staggering 40,000 crores, causing massive losses to retail investors.

Q & A

Who is Ketan Parekh and what is his connection to Harshad Mehta?

Ketan Parekh is a stockbroker who was born into a business family and became the CEO of his father's stockbroking firm, NH Securities. He was inspired by Harshad Mehta and worked under him at Gromo Research & Asset Management, where Harshad Mehta became his mentor.

What was the Harshad Mehta Scam and how did it influence Ketan Parekh?

The Harshad Mehta Scam was a major financial scandal in India involving manipulation of the stock market by Harshad Mehta, leading to his arrest and the exposure of many involved. Ketan Parekh observed Harshad Mehta's system and learned from it, later attempting to execute a similar but more sophisticated scam.

How did Ketan Parekh modify Harshad Mehta's strategy in his own scam?

Ketan Parekh made two significant modifications to Harshad Mehta's strategy: he maintained a low profile to avoid media attention, and he targeted institutional investors and promoters for easier manipulation, rather than retail investors.

What were the four rules Ketan Parekh used to select stocks for manipulation?

Ketan Parekh's four rules for selecting stocks were: 1) the business should be small and easy to manipulate, 2) the company's market capital should be low, 3) the company's trading volume should be low, and 4) the company's future prospects should be high.

What was the significance of the ICE sector in Ketan Parekh's investment strategy?

The ICE sector, which stands for Information, Communication, and Entertainment, was significant in Ketan Parekh's strategy as he targeted low-liquidity IT and telecom firms during the dot-com boom, anticipating high returns and increased investor interest.

What are the two main strategies Ketan Parekh used to manipulate stock prices?

Ketan Parekh used two main strategies: 'pump and dump', where he would buy a significant stake in a company to inflate the stock price and then sell, leaving retail investors with devalued stocks; and 'circular trading', where he orchestrated trades between different parties to artificially inflate trading volumes and stock prices.

How did Ketan Parekh obtain the funds necessary to manipulate the stocks?

Ketan Parekh obtained funds by involving institutional investors and promoters, who were enticed by the prospect of increased stock prices. He also used bank pay orders as a form of collateral to secure loans from banks, which he then used to invest in the stocks.

What was the role of the Calcutta Stock Exchange in the Ketan Parekh scam?

Ketan Parekh chose to operate through the Calcutta Stock Exchange instead of the more scrutinized Bombay Stock Exchange, taking advantage of the looser regulations there to execute his manipulation strategies.

How did the dot-com bubble burst impact Ketan Parekh's operations?

The dot-com bubble burst led to a significant devaluation of IT and internet stocks globally, which affected Ketan Parekh's investments. The Bear Cartel exploited this by short-selling the overvalued stocks, leading to a massive sell-off and the eventual exposure of Ketan Parekh's scam.

What was the final outcome of the Ketan Parekh scam and its estimated value?

The Ketan Parekh scam was exposed after the banks he used for loans faced bankruptcy, leading to an RBI inquiry. The scam is estimated to have been worth 40,000 crores and had a significant impact on retail investors, some of whom suffered substantial financial losses.

Outlines

00:00

📈 Introduction to Ketan Parekh and His Early Influences

This paragraph introduces Ketan Parekh, the central figure in the second-largest scam of Indian stock markets. Born into a business family, Ketan followed in his father's footsteps by entering the stockbroking business. His professional career began in the late 1980s, joining his father's firm, NH Securities. However, he was significantly influenced by Harshad Mehta, a notorious figure in the Indian stock market, and joined Mehta's firm to learn the intricacies of stock market manipulation. Ketan was known for his soft-spoken nature and had connections with various influential individuals. The paragraph sets the stage for the unfolding of Ketan's rise and eventual downfall, paralleling Harshad Mehta's tactics but with a lower profile approach.

05:01

🏦 Ketan Parekh's Strategies and Manipulation Tactics

The second paragraph delves into Ketan Parekh's strategies for stock manipulation, which were inspired by Harshad Mehta but with significant modifications. Ketan chose to live a simple life to avoid media scrutiny, a lesson learned from Harshad's downfall. His approach involved targeting small businesses with low market capitalization and high future prospects, particularly in the IT and telecom sectors during the late 1990s. He employed two main strategies: 'pump and dump,' where he would buy a significant stake in a company, creating a price surge that attracted retail investors, only to sell his shares at a high price; and 'circular trading,' a disguised form of manipulation where trades were orchestrated to artificially inflate stock volume and price. Ketan also involved institutional investors and promoters, leveraging their influence and capital to further his schemes.

10:02

💼 Financial Maneuverings and the Rise of 'Ketan Stocks'

This paragraph explains how Ketan Parekh secured the funds necessary for his manipulations by leveraging pay orders from banks, particularly MMCB and GBB, where he had significant influence as a major stakeholder. He used these pay orders to pledge shares as collateral for loans, which he then invested in stocks like HFCL and UTI. The paragraph also details the creation of the 'Ketan Stocks' portfolio, which included companies with low liquidity and high future prospects, manipulated to attract retail and institutional investors. The stocks experienced meteoric rises in value, drawing significant media attention and public interest. The narrative highlights the scale of Ketan's operations and the influence he wielded in the market, which was so pervasive that even the banks' policies were bent to accommodate his needs.

15:04

📉 The Dot-Com Bust and the Demise of Ketan Parekh's Scam

The final paragraph describes the unraveling of Ketan Parekh's scam during the dot-com crisis. As the value of IT and internet stocks plummeted globally, Bear Cartel, a group of short-sellers, targeted Ketan's stocks, leading to a massive sell-off. With banks MMCD and GDB on the brink of bankruptcy, Ketan could not sustain the demand for his stocks, leading to a market crash that cost retail investors 2000 crores. The ensuing RBI inquiry exposed the scam, revealing its scale to be around 40,000 crores. The paragraph concludes with a reflection on the lasting impact of the scam on individuals, including a personal anecdote about the health consequences for one of the narrator's father's friends, underscoring the human cost of such financial frauds.

Keywords

💡Scams

A scam refers to a fraudulent scheme designed to deceive people, typically for financial gain. In the context of the video, scams are a central theme as they discuss the Harshad Mehta scam and the Ketan Parekh scam, both of which involved manipulation in the stock market leading to significant financial losses for many investors.

💡Stock Market

The stock market is a platform where shares of publicly traded companies are issued and traded. The video script revolves around the Indian stock market, particularly focusing on how scams like those orchestrated by Ketan Parekh affected the market dynamics and investor confidence.

💡Harshad Mehta

Harshad Mehta is a notorious figure in Indian financial history, known for his involvement in the 1992 stock market scam. The video script uses him as a reference point to introduce Ketan Parekh, who was inspired by Mehta's methods but sought to refine and execute a similar but distinct scam.

💡Institutional Investors

Institutional investors are organizations such as banks, insurance companies, and pension funds that invest large sums of money in securities. In the video, Ketan Parekh is said to have involved institutional investors to lend credibility to his stock manipulation schemes, thereby attracting more retail investors.

💡Pump and Dump

Pump and dump is a type of securities fraud that involves artificially inflating the price of an owned stock through false and misleading positive statements, only to sell the cheaply purchased stock at a higher price. The video script describes Ketan Parekh's use of this strategy to manipulate stock prices and deceive retail investors.

💡Circular Trading

Circular trading is a form of market manipulation where the same stock is traded back and forth among a group of traders to create the appearance of high demand and thereby inflate the stock's price. The video explains how Ketan Parekh used this method to create artificial volume and interest in the stocks he targeted.

💡Retail Investors

Retail investors are individual investors who buy and sell securities for their personal accounts, as opposed to institutional investors. The video script highlights how retail investors were particularly vulnerable to the scams described, often being the ones who suffered the most significant losses due to their 'get rich quick' mentality.

💡Market Capitalization

Market capitalization refers to the total market value of a company's outstanding shares of stock. In the video, Ketan Parekh is said to have targeted companies with low market capitalization for manipulation because they required less money to influence their stock prices.

💡Share Pledging

Share pledging is a practice where a company's promoters use their shares as collateral to secure loans. The video script mentions that Ketan Parekh involved promoters in his scheme, convincing them to pledge shares to banks for loans, which were then used to manipulate stock prices.

💡Pay Order

A pay order is a written request by one party to another to pay a fixed amount of money to a third party. In the context of the video, Ketan Parekh used pay orders as a means to secure loans from banks, which he then used to finance his stock manipulation activities.

💡Bear Cartel

A bear cartel refers to a group of investors who collude to drive down the price of a stock. The video script describes how the Bear Cartel played a role in exposing the Ketan Parekh scam by short selling the overvalued stocks, leading to a massive sell-off and the eventual collapse of the manipulated stock prices.

Highlights

Introduction to the second-largest scam in Indian stock markets.

Ketan Parekh's background and early career in his father's stockbroking business.

Influence of Harshad Mehta on Ketan Parekh's career and strategies.

Ketan Parekh's low-profile lifestyle and its role in avoiding suspicion.

The strategy of targeting institutional investors and promoters for stock manipulation.

Ketan Parekh's choice of stocks based on four simple rules for manipulation.

The role of the dot-com boom in Ketan Parekh's investment strategy.

Description of Ketan Parekh's 'pump and dump' strategy to manipulate stock prices.

Circular trading strategy used to artificially inflate stock volumes and prices.

How Ketan Parekh obtained funds through bank pay orders and manipulation.

Ketan Parekh's involvement with MMCB Bank and GBB Bank for loans.

The portfolio of 'Ketan Stocks' and their influence on retail investors.

The impact of the dot-com crash on Ketan Parekh's stock manipulation.

The role of Bear Cartel in exposing the Ketan Parekh scam.

The scale of the Ketan Parekh scam, estimated at 40,000 crores.

The personal impact of the scam, including a heart attack suffered by the narrator's father's friend.

The enduring presence of stock market manipulation and the psychology behind it.

Transcripts

My father's friend had a heart attack because he got stuck

in this scam.

To quote Suchita Dalal, when I met him sometime in July

2000, I too came away with the impression that he has his

feet too much on the ground to go the Harshad Mehta way.

In fact, until 25th August 2000, when the markets hinted at

the first signs of trouble, most newspapers did not even

have the photograph of the broker. This is the story of the

second-largest scam of Indian stock markets.

This is the story of the man whose mentor himself was

Harshad Mehta.

This is the story of Ketan Parekh.

Ketan Parekh was born in a business family.

His father established a stockbroking business of his own

by the name of NH Securities.

As Ketan Parekh grew up, he completed his chartered

accountancy and became a CEO.

After that, he started his professional career in the late

1980s.

How did it start?

By joining his father's business.

But he was very much inspired by Harshad Mehta.

And because of this, he joined Harshad Mehta's firm Gromo

Research & Asset Management.

And he was mesmerized with Harshad Mehta.

How does Harshad Mehta work? How is he making so much

profit?

What is his charm?

What is his magic?

How does he analyze the stock markets?

How does he choose stocks?

How does it happen that the stock that Harshad Mehta

chooses or even touches, that stock turns to gold?

Ketan Parekh became an understudy of Harshad Mehta, where

Harshad Mehta became his mentor.

It is said that Ketan Parekh as a person was very

soft-spoken.

He did not talk much.

But despite that, he had very good connections with

businessmen, actors, and politicians.

Then came the year 1992.

This year, the entire Harshad Mehta scam bust was done, led

by Sucheta Dalal.

And a lot of people came forward in this bust.

Harshad Mehta was obviously there.

The entire scam was called Harshad Mehta Scam.

Then came the SBI, a lot of businessmen, a lot of banks, a

lot of politicians.

A lot of people's names came forward in this.

But there was not a single person's name anywhere.

That was Ketan Parekh.

Harshad Mehta Scam

Ketan Parekh saw what was the system of Harshad Mehta.

He used to get bank receipts.

And when Harshad Mehta used to get those bank receipts, he

used to get access to a lot of funds.

A lot of money.

Harshad Mehta used to put that money in the stock market,

directly or indirectly, and specifically to his stocks.

The prices of the stocks he had increased so much because

he invested so much money, there was so much demand, the

prices used to increase.

As Harshad Mehta's stock prices increased, what used to

happen first? Media tension.

Everyone used to come to see the stock.

And at that time,

Harshad Mehta had just bought the stock.

Because of that, retail investors used to invest in the

stock.

Because they had that image.

The stock that Harshad Mehta talked about, or invested in,

that is gold.

And when Harshad Mehta's stocks reached such a massive

price, then of course, the profits, they used to reap.

Ketan Parekh wanted to do the same thing.

But he wanted to pull off,

Harshad Mehta Scam 2.0.

He took Harshad Mehta's strategy, but he did a lot of

tweaks in it.

The first tweak,

Ketan Parekh lived a very simple life, which is not in the

media tension.

If you talk about Harshad Mehta, he is completely altered.

Harshad Mehta, in the time cover, the photo with Lexus, a

lot of people say this, reporters say this, and if you

study Harshad Mehta's timeline, since he got that Lexus, he

got so much spotlight, the politicians, the businessmen,

the media, that that

Lexus marked his downfall.

After that,

Harshad Mehta's situation kept getting worse and worse,

till the final 1992 scam.

Ketan Parekh decided,

I want a simple life.

Ketan Parekh was that type of person, who was so

short-spoken, so modest, he didn't have any fancy things,

that no one would have guessed, that he has the potential

to pull off such a big scam.

So Ketan Parekh learned from Harshad Mehta, that if you

want to survive, then keep a very low profile.

The second tweak, that Ketan Parekh did in Harshad Mehta's

strategy, what did Harshad Mehta do?

He would only put bank receipts in that stock.

Ketan Parekh said,

I will definitely take money from the bank, but on those

stocks,

I will invest institutional investors,

I will involve promoters, because manipulating retail

investors is difficult, their viewpoint keeps changing, in

so many months, and there,

Kedar Parikh thought, that if institutional investors, and

promoters are targeted, they are a small audience, it is

easier to manipulate them, and when they invest more in

these stocks, the stock will go up even more, and the trust

of retail investors,

on these stocks will increase even more.

In 1992, when the whole thing went bust, the whole news

came in front of everyone,

Harshad Mehta's scam, spread all over the country.

After that,

Bombay Stock Exchange became very strict.

There was a lot of scrutiny in BSE, a lot of security.

So Ketan Parekh thought, that what is the best situation,

remove Bombay Stock Exchange, we will trade in Calcutta

Stock Exchange. And when he used to choose the stocks,

which stocks he wanted to manipulate, he had 4 simple rules.

First of all, the business should be small, not a big

business, small business, easy to manipulate. Second, the

company's market capital should be very low, less market

capital, less money to manipulate the stock.

Third rule, the company's volume should be low, volume

means number of trades, in that company's stock, the number

of trades, which are happening in a day, should be very

less, and fourth rule, the company's future prospect,

should be very high.

Now this was the time, late 1990s.

If you remember this time, the dot-com boom was about to

start, and the effect of that, started to come in India too.

So because of this,

Ketan Parekh started investing money, in low-liquidity IT

and telecom firms.

He basically, invested in ICE.

And this too, he started after his investments.

ICE means,

Information, Communication, Entertainment.

Now let's see, which stocks did he buy before, it is

important for us to know, how he used to manipulate the

stocks, and what was his strategy.

All of Ketan Parekh's strategies, targeted only one

weakness of retail investors, and that weakness of retail

investors is, to get rich quick.

That hunger,

I will call it that last, as soon as a retail investor,

gets such a stock, whose price is very low, and in no time,

that stock is going up, and up, and up.

Retail investors, can never miss such stocks, and directly

jump to such stocks.

Why? To get rich quick.

His hunger is different.

So both Ketan Parekh's strategies, target the weakness of

these retail investors. The first strategy is, pump and

dump. In this,

Ketan Parekh will use these rules, and according to that,

he will select one company, and he will buy 20-30% stake of

that company.

Now when suddenly, so many stocks of one company will be

bought, share price will go up, when the price of a cheap

stock will go up, retail investors will get tensed, media

will get tensed, retail investors will get more tensed,

then retail investors

will put money, the stock will go up, and up, and up, and

up.

And when the stock, goes up a lot, at that time,

Ketan Parekh used to sell all his stocks, retail investors,

that same cheap stock, after buying it at an expensive

price, used to sit, hoping that it will go up, but that

stock, ended.

The second strategy is, circular trading.

Now circular trading, is like pump and dump, but, it is

disguised. How am I telling you?

So in this strategy,

Ketan Parekh never, used to buy stocks himself.

What will he say?

He will tell trader A, that trader A, you buy so many

stocks, at this price.

Now the volume of that stock is less, so no one wants to

buy it. So then trader B, will be told by Ketan Parekh,

that you sell, the same quantity of stocks, to him.

So you can see, all are planned trades.

What will happen is, when both buy-sell, and buy-sell

trades, are done by the same person, the volume of that

stock, will go up, the prices of that stock, will also go

up.

So many investors, who target one stock, that if its volume

goes up, then it is good.

They will all, buy that stock.

The price of that stock, will go up.

And there,

Ketan Parekh, will sell all the stocks.

The people who were under him, will give them a commission.

And all the profit, will go to Ketan Parekh.

But one question is left, that where did Ketan Parekh, get

so much money from?

As you might remember,

Ketan Parekh, learned from Harshal Mehta that, the stocks

to be manipulated, in those stocks, he will involve the

institutional investors, and the promoters as well. So when

he first, went to the institutional investors, he realized

that, look, the institutional

investors, only invest in the same company, which has a lot

of volumes, which has a lot of media attention.

So Ketan Parekh, used his circular trading strategy,

artificially, increased the volumes and prices, media

attention came, and the institutional investors, started

investing in their own stocks.

Then comes, the promoters.

Ketan Parekh, went to the promoters.

And from the promoters, he raised money, to manipulate,

their own stock.

The promoters thought, that if their stock prices, go up,

their net worth will increase, they can sell their stake,

at a higher price.

And, if the stock prices increase, they can keep their

expensive stocks, in the bank as collateral, and take a

loan.

This is called, share pledging.

And the promoters also benefited from this, so they also

agreed.

Then comes, the final question that,

Harshal Mehta, collected money from the bank receipts,

Ketan Parekh also had to collect, some corpus for himself

to invest,

So what did he play on?

On pay order.

Now pay order, as you can see, it's a bank's check.

So in the beginning, if you are taking a loan from the

bank, you are taking a loan for some work, you have to give

an advance for some work, so what the bank used to do, it

used to give you a pay order, this was a bank's check.

And when you, used to give an advance for your work, or

used to give some token money, that the deal is done, so

the money that you are taking,

If someone is taking a pay order, what happens to him?

See, it's a bank pay order.

It means the bank has approved his loan.

It means clean chit.

If someone is getting a pay order check, the credibility is

automatically very high that it is approved by the bank.

Now, Ketan Parikh used pay orders only.

He first bought a lot of shares of MMCB Bank.

And he bought the shares because when he went to MMCB Bank

for a very big loan, he had influence over that bank

because he was a major stakeholder in that bank.

The loan was granted to him.

He got a pay order slip.

From that pay order slip, he pledged the shares of his MMCB

Bank which he had bought in such a quantity to collateral

to the bank and got more loans sanctioned and put the money

in the stock of HFCL, UTI.

The situation was so bad that 1.3 million pay orders were

issued.

Just imagine the scale at which work had to be done.

And Ketan Parikh had joined the board of directors of two

banks.

The first one was MMCB Bank from which he took the first

pay order.

After that, there was GBB Bank which is Global Trust Bank.

He took a loan of 800 crores from MMCB Bank.

He took a loan of 100 crores from GBB Bank.

And just to tell you, at that time, RBI had a policy that

no bank can give more than 15 crores to any company.

What did Ketan Parikh do?

He bribed the board of directors of the bank.

Now, this part is clear.

Now, let's come to the portfolio of his stocks which is

very famously known as the Ketan Stocks.

If you know someone who was active in the early 2000s stock

market, you can ask him about Ketan Stocks.

These were such stocks that were in the portfolio of 99%

retail investors at that time.

Ketan Stocks were, first of all,

Aftek Infosys, DSQ Software, Global Telesystems,

Himachal Futuristic Communications, that is HFCL, then

Pentamedia Graphics, which was very famous,

Satyam Computers, Silverline Technology,

SSI, Zee Telefims, British Nandy Communications.

And just to show you the influence, these stocks had

promoters involved with Ketan Parikh.

These stocks had such a high traded volume, their prices

were shooting up so fast, they got so much media attention,

that now institutional investors also came to these stocks.

And these stocks have rallied at a level that people still

remember.

Visual Soft, which was a practically unknown company, in

just a few months, went from Rs 625 to Rs 8,488.

Sonata Software was a Rs 9 stock, in just a few months, it

went up to Rs 2,936.

Look at the amount of return that I'm talking about.

Zee was a Rs 30 stock, it went up to Rs 720.

These were the Ketan Stocks.

There was a huge hype around them.

A lot of retail investors started investing in these

specific Ketan Stocks.

And do you know, the unfortunate thing is, even today,

there is manipulation in the stock market.

No matter how strict the rules are, big investors, they

play on their psychology.

This weakness of retail investors, to get rich quick, what

is it?

It's not a weakness, it's a psychological trait, which is

still as common today.

What you need to understand is that, how big investors play

their psychology game.

How do big investors play?

Why do small investors lose money every time?

The answer is the same, psychological trait.

For this, there is a whole workshop of Goela, where I

explain to you, the stock market psychology, case studies,

facts, to make sure that you never get stuck in such things.

To make sure that you come in the league of big investors,

and not in the league of small investors, who unfortunately

lose money.

This session, will completely open your mind.

You will be surprised, what all happens in the stock market.

Link of this masterclass, is in the description below.

Let's come back to the story.

Everything is going well.

Ketan Parekh sir, has involved the institution investors,

has involved the promoters, living a very low standard

life, not even coming in the eyes of anyone.

So how did this scam get caught?

Well, now he is going to talk.

This was such a beautifully crafted scam, because, Ketan

Parekh sir, first thing, as he said, low profile.

No one can doubt him.

When people caught him, people still didn't believe, that

Ketan Parekh was behind this.

He maintained a low profile at that level.

Second thing, that he was not in the Bombay Stock Exchange,

he was in the Calcutta Stock Exchange, where the

regulations were already loose.

And third thing, he didn't take stocks in his name, nor did

he take stocks in his DMAT account.

He used to take stocks, in the name of others, through his

stock brokers.

So now think for yourself, there is no chance of getting

caught.

His name will never pop up.

The problem came, when the dot-com crisis came.

If you remember, at the start of the story,

I told you that,

Ketan Parekh started investing, when the dot-com boom came,

in the late 1990s.

Now it was the time of 2001-2002, when the dot-com burst.

Because at this time, in the US, there were small IT

companies, internet companies, which were so overvalued,

and all their prices were breaking, and coming straight to

the ground.

Now, when this was happening in the US, in India, when Bear

Cartel was there, they understood that, this is the time,

to short IT stocks.

This is the time, to short ICE stocks.

Bear Cartel, shot Ketan Parekh's shares, in abundance.

In simple words, what did Ketan Parekh do?

He used to increase the stock demand, by investing more

money, by placing buying orders.

Bear Cartel, started selling, in abundance.

And if the selling demand is very low, the share price has

to come down.

What is the solution to avoid this?

Increase the demand even more.

Ketan Parekh, should invest more money, in these stocks.

But the problem was, the two banks, which Ketan Parekh used

to manipulate, and take out his money from, those two banks,

MMCD, and GDB, were on the verge of bankruptcy.

So Ketan Parekh, couldn't buy any more shares.

And on their behalf, the stock brokers, who had held so

many shares, for Ketan Parekh, they also couldn't survive.

They had to sell, because of which, so much mass selling

happened.

Bear Cartel, has also started selling.

After that,

Ketan Parekh, had such a big portfolio, he also had to sell

everything.

On that day, retail investors, lost up to, 2000 crores.

2000 crores.

MMCD bank, and GDB bank, were in such a state, that they

didn't have enough money, to return the money to their

depositors.

Then, RBI started an inquiry, on those two banks.

And then, the Ketan Parekh scam, was exposed in front of

everyone.

And it is estimated, that this scam was, of 40,000 crores.

You might be thinking, it's okay if the scam happened.

But this scam, affected a lot of people.

As a matter of fact, one of my dad's friends, got a heart

attack, because of this scam.

This is the entire story.