SEBI goes on overdrive to get retail investors back to market

The Securities and Exchange Board of India will focus more on bringing household savings into the stock markets.

At its board meeting on Monday, the regulator also decided to heavily penalise unregistered collective investment schemes, or the so-called Ponzi schemes, and said that it will proceed against individuals for unfair trade practices, including front running. Front running is the act of buying or selling scrips in advance based on insider information.

The regulator accepted the recommendations of management consultant Oliver Wyman on structural and organisational issues. Following this, SEBI is expected to recommend development of simpler and low-risk products for retail investors and iron out kinks related to distribution commissions.

The regulator has agreed to implement a plan for sharper focus on supervisory functions, oversight of listed companies, re-organisation of functional departments, increasing manpower and using IT. It will also adopt better HR practices for training and performance.

The board meeting was held even as the Securities Laws (Amendment) Ordinance, 2013 was moved in Parliament to give the regulator powers of search and seizure, recover monies by attachment, settle administrative and civil proceedings, set up special courts and the authority to arrest and detain.