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SEBI’s ‘fit and proper’ cloud looms over Chawla’s NSE stint

PALAK SHAH Mumbai | Updated on July 31, 2018

Ashok Chawla, Chairman, NSE   -  BUSINESS LINE

Named by CBI in Aircel-Maxis bribery case

SEBI’s ‘fit and proper criteria’ may cast a shadow over the role of Ashok Chawla as chairman and public interest director of the NSE after he was named in a CBI chargesheet this month as one of the accused in the Aircel-Maxis bribery scam.

Chawla, who was formerly a Secretary in the Finance Ministry, was accused by the CBI of criminal conspiracy in the bribery matter, along with 18 others, including former Finance Minister P Chidambaram and his son Karti Chidambaram.

Lawyers dealing in securities matter say, SEBI has taken a strict view of those it did not find compatible with the ‘fit and proper criteria’ and barred them from holding any post in market intermediaries till they were cleared by any competitive court.

In 2016, SEBI declared Pawan Bansal, the then head of merchant bank Altius Finserv, as not fit and proper after the CBI named him in an FIR and arrested him in the Syndicate Bank bribe for loan scam. SEBI had said that Bansal should not be associated with any registered intermediary in order to maintain the integrity of the securities market and also for the protection of the interests of investors in the securities market.

When contacted by BusinessLine, Chawla said, “What comment can I offer, the matter has not even started. SEBI will decide.”

Raman’s case

In June, former SEBI Whole-Time Member S Raman stepped down from an RBI committee after his name figured in a CBI chargesheet in connection with ₹146-crore loan default by Winsome Diamonds to Canara Bank. Raman was former Chairman of Canara Bank.

In the NSE, Chawla is also a member of mandatory committees such as ethics committee, defaulters committee, sub-committee for monitoring compliance of suggestions given in SEBI inspection report, public interest directors committee, independent oversight committee for member regulation, independent oversight committee for listing function, independent oversight committee for trading and surveillance function and others such as audit, advisory, stakeholders relations nomination and remuneration committee. Chawla is also a Non-Executive Chairman on the board of YES Bank.

Published on July 30, 2018

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