Standing committee to visit Sebi and exchanges to check on surveillance

The Veerappa Moily-headed panel will deliberate on surveillance lapses, gaps in regulations

The Parliamentary Standing Committee on Finance, headed by Verappa Moily will be in Mumbai tomorrow. The first stop would be at the Securities and Exchange Board of India (Sebi) and stock exchanges to check on their surveillance systems.

Additionally, the committee would meet banks to seek report from them on financial inclusion.

This visit at Sebi and stock exchanges assumes importance as it would be the first time that standing committee is scrutinizing the market surveillance system post the Special Investigative Team (SIT) on Black Money raised issues in surveillance system.

"We believe with effective and timely monitoring by Sebi, a significant number of such instances can be checked in time," the report said.

The SIT advised Sebi to red-flag instances pertaining to trading volumes, entities contributing to trading volume and financial backgrounds of firms through annual returns.

The report was also critical of the Participatory Notes (P-Notes), stating that it is leading to creation of black money. The sensex tanked by more than 500 points fearful of curbs on P-Notes. The ministry however, assured that there would not be any knee jerk reaction.

The standing committee member, who did not wish to be quoted, told Business Standard apart from surveillance issue the committee will discuss with the market regulator various recent initiatives taken to reform the markets.

The meeting with banks and other financial institutes would gauge progress in the government flagship schemes of financial inclusion schemes such as Jan Dhan Yojana, Atal Pension Yojana, Jeevan Jyoti Bima Yojana.