Search the Internet          Tips  Sites: Finance, Investment

SEBI to get search and seizure powers

In a bid to provide more teeth to the Securities and Exchange Board of India, the finance and law ministries on Monday decided to grant search and seizure powers to the regulator for offences like insider trading and market manipulations.

Adequate safeguard has, however, been provided to ensure that SEBI does not misuse the search and seizure powers.

"For carrying out search and seizures, the order has to pass through the SEBI chairman and a higher authority like a magistrate," economic affairs secretary C M Vasudev told reporters after a meeting with top officials of Department of Company Affairs and SEBI.

Secretary, DCA, V K Dhall said the search and seizure powers would be for serious offences like insider trading and fraudulent market manipulations.

Endorsing the ministries' nod for additional powers to the regulator, SEBI chairman G N Bajpai said: "The regulator has to be empowered adequately enough so as to deter any offences."

SEBI wanted the search and seizure powers as it could not provide "strong evidences" in a court of law to prove the guilt of scamsters who manipulated the markets.

The two ministries also approved SEBI's demand for a maximum penalty of Rs 250 million for "serious" offences, Dhall said, adding SEBI can impose penalty of upto Rs 10 million for other offences.

Bajpai justified the higher penalty limits saying "it would act as a deterrent for offenders."

ALSO READ:
The SEBI Story
The Rediff Budget Special
Money

Tell us what you think of this report