Capital market regulator SEBI has restrained P J Mathew (former Managing Director of the erstwhile Inter-connected Stock Exchange of India or ISE) from accepting the position of Managing Director or Chief Executive Officer in any stock exchange for one year.

Duty bound

In an order on Thursday, SEBI said, “As MD of a SEBI recognised stock exchange, it was the duty of the noticee to implement the provisions of the MIMPS Regulations in letter and spirit. The fact that an employee of Religare was approached to act as proxy for an alleged person acting in concert (PAC) gives an indication that they could be acting with a common purpose.”

SEBI added that ISE should not have been satisfied with a routine query and accepted a bland denial. “They should have tried to further explore the relationship among the alleged PACs and in case of doubt, should have informed SEBI. The MD/stock exchange could have sought guidance from SEBI with respect to compliance with MIMPS Regulations. The noticee did not follow the prudent path and simply kept quiet and, therefore, had not acted in the best interest of the securities market.”

SEBI also did not accept Mathew’s submission that he acted as a proxy (to help SEBI) for a few shareholders of the stock exchange in respect of a resolution to amend the Articles/rules as directed by SEBI.