Sebi employees revive association to protect themselves

Move comes amid string of CBI inquiries and coming merger with FMC

Employees of the Securities and Exchange Board of India (Sebi) have revived an association they had formed years ago but had become defunct over the years. The move to rejuvenate Sebi Employees’ Association follows regulatory officers being embroiled in a string of Central Bureau of Investigation (CBI) inquiries in various cases and precedes the body’s absorption of the Forward Markets Commission (FMC).

“The purpose of the association is to work with the management to strengthen Sebi,” said a source. The association was cleared in 1995 and was also operational for a few years. However, it became non-operational later on.

The association has so far been able to get nearly 200 members. It is in the process of constituting a managing committee, which will not have any Sebi board member. “The committee would coordinate with the board on various issues of the markets as well as the concerns of the employees,” said another source. According to insiders, the move to revive the association began soon after 30 Sebi officials came under the scanner of CBI, probing them for  alleged criminal misconduct and conspiracy.

Such mass scrutiny by an external agency was a major setback for Sebi and also affected the productivity and morale of employees, according to Sebi veterans.

In March 2014, the CBI had registered a preliminary enquiry (PE) against former Sebi chairman C B Bhave and former whole-time member K M Abraham over grant of a licence to MCX Stock Exchange. In August, the CBI converted this into a first information report (FIR), without naming either of them. However, four officials, three serving and one former — who had worked on the case, were named in the FIR.

The multi-crore Saradha scam has also placed a spotlight on the regulator. According to people in the know, CBI has interrogated about 15 of its officials who handled or were part of investigations and adjudicating proceedings. In a matter related to Bank of Rajasthan, CBI registered a PE against five Sebi officials, including the adjudicating officer, investigating officer and head of the investigation department.

According to insiders, an active association will be able to protect the interest of Sebi and its employees better. The Sebi-FMC merger, slated for September, requires a smooth transition to merge the workforce as well as the additional requirement of manpower. The association could help in facilitating that. According to sources familiar with the matter, the association will not be involved in any protest or strike that would be detrimental to the organisation in any form. An email sent to regulator did not elicit a response.