Govt receives two dozen applications for Sebi chairperson's post

The government has received close to two dozen applications for the Securities and Exchange Board of India (Sebi) chairperson’s post. The last day to submit applications ended on Monday.

Sources in the government said top bureaucrats, including officials from the department of financial services, the department of economic affairs, and also the Ministry of Corporate Affairs, have applied for the position. Top Sebi officials also are in the reckoning.

The selection panel, which is headed by the cabinet secretary, would shortlist the candidates and interview them.

On the other hand, government sources are also not ruling out an extension to incumbent chairman Ajay Tyagi, whose term ends this month. Tyagi was appointed for a tenure of three years. He took charge from his predecessor U K Sinha on March 1, 2017.

The finance ministry had on January 27 put out an advertisement seeking applications for the post by February 10.

Observers said an extension to Tyagi could be a possibility as the advertisement, which was floated, gave just two weeks to those interested to apply for the post. Usually, the search process starts three months in advance as the selection process is timing-consuming.

Meanwhile, the Sebi board is slated to meet on Monday in Mumbai, where it will finalise the sandbox policy and also approve measures to tackle “difficult to recover” dues.

To enhance recovery proceedings and tighten the noose around market offenders, Sebi is likely to introduce a mechanism to recover dues from untraceable individuals. The new mechanism may allow the market regulator to seize assets of the alleged violators, even before a final judgment is passed by appellate bodies.

Under the new policy, Sebi may also be able to recover penalties by seizure of bank accounts and other assets, if the accused fails to file an appeal within 45 days of the order passed by Sebi.

Currently, such recovery can only be made after the Supreme Court passes a judgment in the matter.

Under the said rule, Sebi will identify such cases and segregate them as “difficult to recover", according to the provisions of the General Financial Rules, 2017.

Currently, there is no provision in the Sebi Act, or regulation to declare and segregate dues as non-recoverable.  

The new framework will ensure better recovery proceedings and launch prosecution under Section 24(2) of the Sebi Act, 1992 in special courts, a source said. The Sebi board would weigh the nuances of this measure and whether the new policy for recovery needs to be framed in a comprehensive manner and on the lines of the Central Board of Direct Taxes provisions.

Further, to encourage the use of fintech innovations in the capital markets, Sebi is planning to allow live-testing of new products, services, and business models for select customers.