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Tuesday, Oct 26, 2021
Outlook.com

'The Suspension Is Unjustified'

The first woman to be elected to the BSE board, Deena Mehta feels SEBI's decision to suspend all broker-directors of the exchange will not stop insider trading. Excerpts from an interview to Outlook:

'The Suspension Is Unjustified'
'The Suspension Is Unjustified'
outlookindia.com
-0001-11-30T00:00:00+05:53
On the suspension: It's totally unjustified. sebi's charge seems to be merely that some member-directors were present when some information was being obtained by a broker office-bearer. In fact, a meeting was under progress with the brokers' forum to discuss the turnover tax issue. Just because we were doing some work in (Anand) Rathi's chamber, we have been suspended!!

On interference by broker directors: It is established that Rathi's phone call ended at 3.16 pm by when the market had already fallen. So the allegation of using the information to trigger a fall is unjustified. Interference, as I understand, means preventing staff from performing their duties. After enquiries on the reasons of the fall, I don't see how the surveillance members were prevented from performing their duties. In fact, sebi has stated that the board would oversee the functioning of the surveillance department. The fall was very unusual and hence inquiries were made by Rathi. There is no interference in any manner by any of us. In fact, the present board has introduced the new surveillance system, boss, and it had all the security features which included taping all conversations in the room.

On why Rathi sought the information: I can't comment on Rathi's reasons for seeking the information. However, whenever there is a sharp fall in the market, all board members and especially the president get phone calls about the reasons behind the fall.

On the BSE's future: It's not proper to say anything against broker-directors on the board or absence thereof as a reason for problems in the exchange. What matters is whether we have a preventive and corrective system. I assure you that the bse has adequate systems, like a state-of-the-art surveillance department. Also, going by the logic, after suspension of all broker-directors, the market should...
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