Markets regulator Securities and Exchange Board of India (SEBI) has summoned several former directors of Zee Entertainment Enterprises Ltd (ZEEL) as part of its probe into the entertainment company over the diversion of company funds, allegedly through related-party transactions, Moneycontrol reports, citing two people directly aware of the development.
“So far, two former independent directors have been asked to appear before Sebi and testify,” said one of the people cited above. “Both these directors had left the company’s board around 2021,” the person told Moneycontrol, requesting anonymity.
The report states that the regulator has also widened the scope of the investigation. SEBI is also looking into the role of two prominent Mumbai-based production houses as possible “conduits which were used to siphon off funds,” a second person said.
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The regulator is also probing a wider array of transactions between Zee and private companies owned by promoters. “Some of the former directors, including the independent directors, have received communication to appear before Sebi. They have also been asked to provide certain documents pertaining to the period when they were on the board of the company,” the first person said.
A Zee spokesperson denied allegations about accounting irregularities at the company.
In August 2023, SEBI passed an interim order against promoters Subhash Chandra and his son Punit Goenka, barring them from holding any directorships in listed companies, over allegations of funds siphoning.
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