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The Securities & Exchange Board of India (SEBI) has set a deadline of one year for completing enforcement action against market offenders. For the current fiscal, the regulator aims to accord top priority to further strengthen its enforcement wing. In its board meeting on March 22, SEBI had finalised key policy initiatives for the current fiscal which included ‘further streamlining the enforcement process to ensure uniformity in approach and improve the efficiency of enforcement proceedings across the organisation.’
“Based on the recommendation of consultant Oliver Waymen, we worked from last July to March this year on forming one consolidated enforcement wing. Now it will start showing results,” a senior SEBI official told BusinesLine .
The regulator has three separate enforcement wings — Investigation, Collective Investment Scheme (CIS) and Surveillance. This caused problem not just in deciding and monitoring, but also in following up in court, appellate tribunal and the Supreme Court. “Delay in enforcement basically helped the offenders and this needed to be discouraged,” he said. Keeping this in mind, a task force was constituted for further streamlining enforcement process as advised by Oliver Wyman. It recommended modalities to ensure smooth transfer of cases. Based on these recommendations, the regulator will streamline the enforcement process by focusing on reducing delays, lay strict timelines for completion of actions, put in place efficient follow-up mechanisms and create a central database of enforcement actions and monitoring systems.
The regulator is also focusing on developing capabilities to effectively utilise the additional enforcement powers which it got through Securities Laws (Amendment) Act, 2014. The focus would be to enforce orders imposing monetary penalties and directions for disgorgement and refund of money by using the newly vested recovery powers. Reducing the enforcement time will take SEBI ahead of its global peer. The US and European countries take two to four years to complete the investigation and enforce action. While in India, it is 2-3 years or even more. Now, regulators expect things will change.
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