Harshad Mehta Scam|| Hanif shaikh Scam || How operator Trade in stock Market

The Harshad Mehta scam refers to a major financial scandal in India that took place in the early 1990s. Harshad Mehta, a stockbroker and financial operator, played a central role in manipulating the Indian stock market. Here are the key points related to the Harshad Mehta scam:

1. *Background:*
The scam unfolded in 1992 and involved large-scale manipulation of the stock market using funds from the banking system.
Harshad Mehta was a well-known figure in the Bombay Stock Exchange (BSE) and was known for his aggressive trading strategies.

2. *Bank Receipt Scam:*
Mehta exploited loopholes in the banking system to carry out his fraudulent activities. He used bank receipts, essentially promissory notes, to manipulate the stock market.
He used these bank receipts to obtain funds from banks, which were then used to invest in the stock market.

3. *Stock Price Manipulation:*
Mehta engaged in a technique known as "circular trading" to artificially inflate the prices of certain stocks.
By creating a demand for certain shares, he drove up their prices, leading to a speculative boom in the stock market.

4. *Impact on the Stock Market:*
The manipulated rise in stock prices created a false sense of optimism in the market, attracting many investors.
The scam contributed to a bullish run in the stock market, and the BSE Sensex witnessed a significant surge during that period.

5. *Discovery and Fallout:*
The scam was eventually uncovered, leading to investigations by regulatory authorities and law enforcement agencies.
Harshad Mehta and several others were arrested in connection with the scam.
The aftermath of the scam had a profound impact on the Indian financial system, leading to reforms and changes in regulatory practices.

6. *Legal Proceedings:*
Harshad Mehta faced legal consequences and was charged with multiple financial offenses.
He spent time in custody during the trial but died in 2001 before the legal proceedings could conclude.

7. *Reforms and Lessons:*
The Harshad Mehta scam prompted a reevaluation of the regulatory framework and risk management practices in the Indian financial system.
The Securities and Exchange Board of India (SEBI) was strengthened, and measures were implemented to prevent similar financial frauds.

The Harshad Mehta scam remains one of the most significant events in the history of Indian finance, highlighting the vulnerabilities in the financial system and the need for robust regulatory mechanisms.


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1500 crore SMS stock tip scam mastermind Hanif Sheikh fled India