SEBI investigations into pending cases gather pace under Ajay Tyagi

PALAK SHAH Mumbai | Updated on August 06, 2018

Speedy winding up of LTCG cases one reason for the improved show, say analysts

SEBI seems to have stepped up the pace of concluding investigations into pending cases. Yet, the rate of detection of insider trading cases could be falling.

Data till December 2017 accessed by BusinessLine show SEBI completed investigating the highest number of price-rigging and market manipulation cases in the past couple of years. A notable pick-up in this was seen in the first nine months after Ajay Tyagi took charge as chairman. This is the highest since 2011.

According to the data, which is provided by the regulator with a lag, SEBI wound up investigation into 98 cases of price rigging and market manipulation between April and December 2017 after Tyagi’s appointment. Prior to this, for the full year 2016, SEBI had completed investigating 118 cases of price-rigging and market manipulation. Between 2011 and 2016, the highest number of price-rigging and market manipulation cases completed by SEBI in a single year was 86 and the lowest was 37.

According to legal experts tracking SEBI, it is winding up investigations into long-term capital gains (LTCG) tax cases, which could have mainly improved SEBI’s tally of concluding investigations. The regulator had taken up investigation into around 144 cases related to LTCG avoidance that fell under market manipulation. In a majority of these cases, SEBI did not find manipulation.

But the regulators’ investigation into insider trading cases may have slowed down. After it managed to take up 34 cases of insider trading for investigation in 2016, only nine cases pertaining to the same offence were take up for probe by SEBI between April and December 2017. The highest number of insider trading cases detected by SEBI was 28 that came in 2010-11 and the lowest number 10 so far was in 2014-15.

Clearing the older ones

Ever since he took charge as chairman in March 2017, Tyagi is busy dealing with past issues that saw no action for years. In June 2017, Tyagi had expressed concern over some 7,000 cases older than two years pending enforcement and investigation. In February the same year, a note from SEBI’s vigilance department had said the same thing.

Published on August 06, 2018

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