A market regulator investigation has shown that the former chief of India's largest stock exchange discussed private information with a yogi and asked his counsel on important issues. This was revealed prior to the bourse's much-anticipated public listing.
The Securities and Exchange Board of India (SEBI) said Chitra Ramkrishna, the former chief executive of the National Stock Exchange (NSE), shared information such as the financial projections of the bourse, business plans, and board agenda with a supposed spiritual guru in the Himalayas in a case which was described by the SEBI as "bizarre misconduct" that was a "glaring breach" of regulations.
"The sharing of financial and business plans of NSE ... is a glaring, if not an unimaginable, act that could shake the very foundations of the stock exchange," SEBI said in an order, as it imposed penalties on Ramkrishna, the bourse and other top former executives for the breaches.
Ramkrishna, who left NSE in 2016 for "personal reasons," could not be reached for comment right away. Requests for response from the NSE and SEBI were not returned.
For some years, NSE has been beset by allegations of corporate governance failures. The exchange intended to go public in 2017, but it was delayed due to suspicions that officials gave some high-frequency traders improper access to co-location servers, which might have sped up algorithmic trading.
SEBI penalized the exchange over $90 million and restricted it from soliciting money on securities markets for six months after a three-year probe. The NSE has filed a judicial challenge to the order and has asked SEBI for permission to file for a new IPO.
During that probe, however, SEBI discovered papers proving Ramkrishna's communications to an unknown individual, whom she claimed was a "spiritual force" she had sought direction from for 20 years during interrogation.
In her defense, Ramkrishna informed SEBI that sharing information with someone who was "spiritual in nature" did not jeopardize confidentiality or integrity.
However, the SEBI ruling found that Ramkrishna's claim that exchanging sensitive information such as dividend pay-out ratios, business strategies, and NSE staff performance reviews did not cause harm was "absurd."
The supposed guru also had significant influence over the employment of a mid-level employee with no capital market expertise as a direct adviser to Ramkrishna, with inadequate paperwork and remuneration that was higher than most senior NSE executives, according to the SEBI investigation.
According to SEBI, the guru was in charge of the exchange, and Ramkrishna was "merely a puppet in his hands."
Questions sent to an address listed in the SEBI order as belonging to the guru did not receive a prompt response.
SEBI further stated that NSE and its board of directors were aware of the secret information exchange but preferred to "keep the situation under wraps."
NSE was penalized 20 million rupees ($270,000) by the regulator, and the exchange was forbidden from launching any new products for six months.
Ramkrishna was fined 30 million rupees by SEBI and was forbidden from working for any bourse or SEBI-registered middleman for three years.
In the early 1990s, Ramkrishna was one of a group of executives who founded NSE as a rival to the more established BSE Ltd, formerly known as Bombay Stock Exchange. She joined NSE as a joint managing director in 2009 and was promoted to CEO in 2013.
(Source:www.liveemint.com)
The Securities and Exchange Board of India (SEBI) said Chitra Ramkrishna, the former chief executive of the National Stock Exchange (NSE), shared information such as the financial projections of the bourse, business plans, and board agenda with a supposed spiritual guru in the Himalayas in a case which was described by the SEBI as "bizarre misconduct" that was a "glaring breach" of regulations.
"The sharing of financial and business plans of NSE ... is a glaring, if not an unimaginable, act that could shake the very foundations of the stock exchange," SEBI said in an order, as it imposed penalties on Ramkrishna, the bourse and other top former executives for the breaches.
Ramkrishna, who left NSE in 2016 for "personal reasons," could not be reached for comment right away. Requests for response from the NSE and SEBI were not returned.
For some years, NSE has been beset by allegations of corporate governance failures. The exchange intended to go public in 2017, but it was delayed due to suspicions that officials gave some high-frequency traders improper access to co-location servers, which might have sped up algorithmic trading.
SEBI penalized the exchange over $90 million and restricted it from soliciting money on securities markets for six months after a three-year probe. The NSE has filed a judicial challenge to the order and has asked SEBI for permission to file for a new IPO.
During that probe, however, SEBI discovered papers proving Ramkrishna's communications to an unknown individual, whom she claimed was a "spiritual force" she had sought direction from for 20 years during interrogation.
In her defense, Ramkrishna informed SEBI that sharing information with someone who was "spiritual in nature" did not jeopardize confidentiality or integrity.
However, the SEBI ruling found that Ramkrishna's claim that exchanging sensitive information such as dividend pay-out ratios, business strategies, and NSE staff performance reviews did not cause harm was "absurd."
The supposed guru also had significant influence over the employment of a mid-level employee with no capital market expertise as a direct adviser to Ramkrishna, with inadequate paperwork and remuneration that was higher than most senior NSE executives, according to the SEBI investigation.
According to SEBI, the guru was in charge of the exchange, and Ramkrishna was "merely a puppet in his hands."
Questions sent to an address listed in the SEBI order as belonging to the guru did not receive a prompt response.
SEBI further stated that NSE and its board of directors were aware of the secret information exchange but preferred to "keep the situation under wraps."
NSE was penalized 20 million rupees ($270,000) by the regulator, and the exchange was forbidden from launching any new products for six months.
Ramkrishna was fined 30 million rupees by SEBI and was forbidden from working for any bourse or SEBI-registered middleman for three years.
In the early 1990s, Ramkrishna was one of a group of executives who founded NSE as a rival to the more established BSE Ltd, formerly known as Bombay Stock Exchange. She joined NSE as a joint managing director in 2009 and was promoted to CEO in 2013.
(Source:www.liveemint.com)