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Sebi chief downplays market irregularities

In a dramatic twist, Sebi chairman D R Mehta on Monday told the Joint Parliamentary Committee that he did not consider the happenings in the stock market in March last as a 'scam' even though there might have been certain irregularities.

Deposing before the JPC, Mehta said there might have been some irregularities and flouting of some rules, but those happenings could not be construed as a 'scam'.

JPC chairman Shriprakash Mani Tripati told reporters that Mehta, however, admitted there might have been lack of supervision at certain points of time.

But since the stock exchanges did not remain closed even for a single day during the period under review, it would not be appropriate to describe the happenings as a scam, Tripati quoted Mehta as saying during the deposition.

Asked if the JPC chairman agreed with Mehta's observation, Tripati said JPC was set up because Parliament was of the view that there was a stock scam.

The purpose of the parliamentary probe was to come out with recommendations to prevent recurrence of such scams, he said.

Mehta was also questioned by JPC members on implementation of recommendations of the 1997 committee on settlement of trading in stock exchanges.

Mehta maintained that from time to time the market regulator issued guidelines for orderly behaviour of the market.

Just because there was no separate circular on this, it did not mean Sebi has not issued guidelines.

Referring to irregularities in Calcutta Stock Exchange, Mehta said barring one payment crisis, settlements in the stock exchange were by and large orderly.

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