Deficient regulation

Sebi needs capacity to protect investor interests

The Securities Appellate Tribunal (SAT) has set aside much of the disgorgement-cum-penalties imposed on the National Stock Exchange (NSE) in the co-location case in an April 2019 order by the Securities and Exchange Board of India (Sebi). The tribunal has also revoked the penalties imposed on Chitra Ramkrishna and Ravi Narain, who were senior officers of the NSE. It has asked the markets regulator to reconsider the extent of disgorgement imposed on another company, OPG Securities, which was indicted. However, reports indicate that Sebi is likely to approach the Supreme Court. The co-location case refers to preferential access given to some high-frequency traders on the NSE’s platform. These select entities received advance price information, and allegedly profited by front-running. In another investigation of the NSE’s functioning, Sebi discovered Ms Ramkrishna had bypassed the NSE board in appointing Anand Subramanian group operating officer and advisor to the managing director (herself) at a very high compensation.

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