Sebi officials say that lack of adequate powers has hindered the functioning of the regulator. ``Sebi has no powers of attachment and disgorgement of ill-gotten profits. There are no powers of search and seizure,'' he said.

With the number of manipulators and fly-by-night operators rising, Sebi can be more effective by getting more powers to punish the guilty.

Currently, the powers of Sebi while enforcing the provisions of the Sebi Act are limited to prosecution and suspension or cancellation of the registration. The maximum monetary penalty that it can award on violation is only Rs five lakh. This means a company which is involved in a Rs 300 crore violation can get away with Rs five lakh penalty.

``We have already recommended to the government aboutgiving more powers to us,'' said a Sebi official.