SEBI to Challenge Court-Ordered FIR Against Ex-Chief and Officials
The Securities and Exchange Board of India (SEBI) is gearing up to contest a directive from the ACB Court in Mumbai, instructing the filing of an FIR against former chairperson Madhabi Puri Buch, three current whole-time members, and two officials of BSE. SEBI, in a statement released on March 2, swiftly dismissed the complaint, labeling it as the handiwork of a “frivolous and habitual litigant,” and vowed to pursue legal action to challenge the ruling.
Challenging Allegations
Expressing their stance, SEBI pointed out that the accused officials were not even in their respective roles during the time in question. Interestingly, the court’s decision was made without granting SEBI the opportunity to present its side of the story. It’s worth noting that the applicant has a history of filing baseless lawsuits, with prior cases dismissed by the court and costs imposed in some instances. SEBI is resolute in its commitment to ensuring regulatory compliance and plans to contest the court’s order through legal means.
Prima Facie Evidence Emerges
A special court in Mumbai has directed the Anti-Corruption Bureau (ACB) to initiate an FIR against Madhabi Puri Buch and five other officials over allegations of stock market fraud and regulatory breaches. The court’s order, issued on March 1 by special ACB court judge Shashikant Eknathrao Bangar, highlighted the presence of prima facie evidence necessitating a thorough and impartial investigation. The court has set a 30-day deadline for a status report and emphasized the need for judicial intervention under the Criminal Procedure Code (CrPC) due to the perceived inaction of law enforcement agencies and SEBI.
Allegations of Financial Fraud and Collusion
The complaint paints a grim picture of large-scale financial fraud, regulatory violations, and corrupt practices. It alleges the fraudulent listing of a company on the stock exchange with the complicity of regulatory bodies, sidestepping compliance standards outlined in the SEBI Act of 1992. Furthermore, it accuses SEBI officials of turning a blind eye to market manipulation and corporate malfeasance.
Buch’s Controversial Legacy
Madhabi Puri Buch, the trailblazing first female chairperson of SEBI, concluded her tenure on February 28 amidst a maelstrom of controversies. While her leadership ushered in positive changes such as expedited equity settlements, increased FPI disclosures, and greater mutual fund participation through the ₹250 SIP initiative, her final year was marred by allegations from US-based short-seller Hindenburg Research and heightened political scrutiny from the Congress party.
In conclusion, SEBI’s decision to challenge the court-ordered FIR against its former chief and officials underscores the regulatory body’s unwavering commitment to upholding transparency, integrity, and accountability in India’s financial landscape. As the legal battle unfolds, the outcome will undoubtedly shape the future trajectory of regulatory oversight and governance in the country.
