Kathmandu, 25 May: A few years ago, stock trader Dipendra Agrawal used to trade through securities broker number 43. Operating others’ TMS (Trading Management System) accounts, Agrawal still has unresolved dues of about NPR 130 million (13 crore) to that broker firm from previous transactions.
Due to his suspicious trading activities, senior officials at Nepal Stock Exchange (NEPSE) had warned Agrawal not to engage in abnormal practices — even going as far as threatening to “break his legs.”
More recently, a dispute related to his transactions with Sipla Securities escalated to the police. According to documents Sipla submitted to the Securities Board, the broker is owed nearly NPR 9 million (90 lakhs). However, Agrawal filed a complaint with the Securities Board claiming NPR 108.8 million (10.88 crore) including interest of NPR 30 million (3 crore). This led the board to launch an investigation, the findings of which were later forwarded to the Nepal Police.
Similar irregularities were observed with other firms Agrawal traded with, such as Hatemalo and Shreekrishna Securities. According to a source at the Securities Board, he also caused trouble with brokers numbered 38, 73, and 58 by trading through them and causing unnecessary complications.
The board’s analysis showed that Agrawal traded on credit through Sipla Securities, resulting in settlement issues. He reportedly used other individuals’ names for trading, avoided the mandatory 25% upfront payment for trading limits, and issued bounced or problematic cheques even when he did pay. In one notable instance, he traded using Jyoti Agrawal’s name, issuing a cheque of NPR 3.3 billion (330 crore) to Global IME Bank with no maturity date.
Agrawal was found manipulating stock prices by matching trades using multiple accounts and creating difficulties for brokers and regulators. Examples include Hatemalo Financial Services and Shreekrishna Securities, where such activities occurred.
Due to the temptation of high commissions from large-volume traders like Agrawal, broker companies themselves ended up facing charges related to money laundering. When it couldn’t be verified who exactly conducted the trades — since Agrawal used other people’s accounts — the brokers became liable. Three brokers are now facing maximum fines under securities laws and money laundering regulations.
Dipendra Agrawal has deceived not only ordinary investors but also stockbrokers, by frequently delaying payments after trades.
The Securities Board confirmed that Agrawal operated more than a dozen TMS accounts. Complaints were filed after it was found he traded through multiple accounts, used others’ funds when owed to him, and avoided repayments when he owed money.
During its investigation, the board found that he tried to manipulate and defraud as many as a dozen broker companies. An official from the board stated that they are also monitoring his practice of placing fake or unfulfillable buy orders to artificially influence share prices.
“We are monitoring irregular activities in the securities market,” said the official. “Once confirmed, the board takes action, but it takes time for results to become visible.”
NEPSE officials noted that Agrawal often placed orders in such a way that blame would fall on the brokers. He conducted all trading under the names of relatives, demanded payments owed to him, but caused disputes over payments he had to make — troubling brokers in the process.
A broker who has dealt with Agrawal shared that some brokers now refuse to trade with him. “He’ll go to any extent to collect money from shares he sells, but creates hurdles when it’s his turn to pay for shares bought under other names. That puts us in a difficult position.”
Because of his pattern of cheating both the general public and brokers, the Securities Board has been advised to expedite the legal action against him.
Weaknesses Among Broker Companies Too
The board also revealed that some brokers were complicit in Agrawal’s dealings. With the number of broker licenses reaching 92, unhealthy competition has increased — leading brokers to undercut the transaction fees set by the board, just to attract high-volume clients.
A board official mentioned that offering discounted rates to big traders, rather than evaluating how legally they operate, has caused problems. Brokers are also at fault for allowing credit-based trading, contrary to regulations. The competition to gain clients has made brokers more vulnerable.
Agrawal Targeted Migrant Workers on Social Media
Recently, Agrawal appears to have targeted Nepali migrant workers abroad via social media. Since most domestic investors are now aware of his behavior, he started promoting shares to those overseas, promising to double or triple their money.
With the rise of online trading systems, even Nepalis abroad can now invest in the stock market. Taking advantage of this, Agrawal reportedly promoted specific shares, claimed prices would skyrocket, and then sold his own holdings when migrants bought in. Brokers say share trading in stocks Agrawal promoted saw a significant increase in foreign transactions.
Delayed Action Against Agrawal
After several complaints regarding fraudulent share trading, the Securities Board launched an investigation, completed it with police support, and prepared a final report.
However, because the case involves criminal offenses, further legal proceedings require additional investigation by Nepal Police before prosecution can begin — as stipulated under the Securities Act.
Although the board has prepared the report, it appears it has not yet forwarded it to the police. A police officer confirmed that no file related to Agrawal had been received from the Securities Board.
