Sebi Report Skirts Rathi

The interim investigation report of the Securities & Exchange Board of India (Sebi), presented to the members of the joint parliamentary committee (JPC), has no mention of Anand Rathi beyond a reference that the probe (on him) is being dealt with separately.

Anand Rathi, the former Bombay Stock Exchange (BSE) president, resigned from the exchange, while his firms were barred from trading following taped conversations which indicted him of seeking price-sensitive information from the exchange's surveillance department and allegedly using the information to his own interests.

Sebi officials said though the events were inter-linked, the market watchdog prefers to treat it separately. "We have mentioned it in the interim report that a separate investigation is being pursued and another report will be furnished on it," sources said.

So far Sebi has made only a passing mention of him in the interim report. This is significant as the market crash in March and the events that led to the plunge thereafter form the main theme of the report.

The Bombay High Court division bench earlier this month dismissed a petition filed by Rathi (against the ban) saying that the order in no way violated the principles of natural justice and Sebi was within its rights in taking the decision.

Industry watchers said that though Rathi had violated the exchange's rules and regulations, the fact remained that Sebi has so far not been able to prove that he did use the information he got to manipulate the market.