Investor-Broker Clash Highlights Growing Trust Issues in Share Market

Police have arrested Jayant Srivastava, General Manager of Sipravi Securities, on charges of fraud in securities transactions.

Srivastava was taken into custody based on a complaint filed by Meeta Murarka Agrawal, the wife of investor Dipendra Agrawal, who was recently arrested and released in a similar fraud case related to securities trading.

According to police, Meeta Agrawal alleged that Srivastava defrauded her of Rs 115 million. Although an arrest warrant had been issued by the court on June 23, Srivastava was only taken into custody after he voluntarily appeared at the Kathmandu District Police Office on Wednesday, August 6. Sipravi Securities operates as broker number 22.

The court has granted police a three-day extension to investigate the case against Srivastava.

A representative from Sipravi Securities clarified that while the company had financial dealings with Agrawal in the past, there are currently no outstanding transactions between the two parties. He added that with the police investigation ongoing, the facts will become clear in the coming days.

“The actions of investors like Agrawal put brokers at risk,” the representative remarked, suggesting that Agrawal had a controversial reputation in the market. Agrawal has been accused of encouraging general investors to buy shares in companies where he had personal interest, with the intent of driving up stock prices.

Earlier, on July 21, Dipendra Agrawal was also arrested on charges of fraud in securities trading. He was released on bail on July 30. His arrest followed a complaint by Dinesh Prasad Sah of Dhanusha, who accused Agrawal of defrauding him of Rs 64.5 million. After his release, Agrawal made public statements on social media suggesting he would seek revenge. He also used his Facebook page to announce the arrest of Srivastava.

Experts say repeated arrests of both investors and broker representatives in fraud-related cases are eroding trust between brokers and general investors.

Industry insiders note that brokers often offer clients generous credit facilities—trading on margins worth millions—which has led to a rise in unsecured transactions and increased risks in recent times. One broker mentioned that large investors are considered lucrative sources of income for brokerage firms, prompting them to offer high trading limits that eventually become high-risk exposures.

The dispute between investor Agrawal and brokerage firms is not limited to Sipravi Securities. In September–October last year, a similar conflict occurred between Agrawal and Sipla Securities, broker number 20, over unsettled accounts.

Agrawal, who had been trading through that firm for five years, was accused of fleeing with cheques worth Rs 160 million during a settlement process. Agrawal, however, claimed that while the broker had made timely payments in the early days, it failed to provide his receivables over the past three years.