Mumbai court directs case against ex-SEBI Chief Madhabi Buch and 5 others in alleged fraud case

Mumbai: A special Anti-Corruption court in Mumbai on Saturday ordered the registration of an FIR against top officials of the Securities and Exchange Board of India (Sebi) including former Sebi Chairperson Madhabi Puri Buch and Bombay Stock Exchange (BSE) in a case of alleged stock market fraud and regulatory violations.

There is prima facie evidence of regulatory lapses and collusion, requiring a fair and impartial probe, special ACB court judge Shashikant Eknathrao Bangar said in his order on March 1. The court has decided to monitor the investigation and has sought a status report within 30 days.

It noted that the allegations reveal a cognisable offence, necessitating a formal probe. The order also criticized the inaction of law enforcement agencies and the Securities and Exchange Board of India (SEBI), stating that judicial intervention was required under the Criminal Procedure Code (CrPC),as per report.

The order issued by Special Judge SE Bangar on a petition filed by Thane-based journalist Sapan Shrivastava, who alleged large-scale financial fraud and corruption in the listing of a company on the stock exchange. Complainant contended that Sebi officials failed in their statutory duty, facilitated market manipulation, and enabled corporate fraud by allowing the listing of a company that did not meet the prescribed norms.

The respondents in the complaint were former Sebi Chairperson Madhabi Puri Buch, Whole Time Members Ashwani Bhatia, Ananth Narayan G, and Kamlesh Chandra Varshney, along with BSE Chairman Pramod Agarwal and CEO Sundararaman Ramamurthy. However, in the court proceeding, none of them were represented.