Sebi seeks overhaul of securities laws for greater powers

Market regulator Sebi has sought major overhaul of the securities laws including greater authority to nail manipulators by way of powers to conduct 'search and seizure' operations and to demand information from any person in relation to its probes.

It has also proposed the recovery of monetary penalties through income tax arrear mechanism, setting up of special courts to deal with criminal prosecution for violation of securities laws and recognition of Sebi's counsels as public prosecutors.

The proposals have been discussed by the Sebi board and are being sent to the finance ministry for necessary amendments to the relevant securities laws, a senior regulatory official said.

Sebi has decided to pursue these proposed amendments in view of the challenges faced by it in areas such as the recovery and realisation of monetary penalties and regulation of pooling of monies from public by schemes including those in the nature of collective investments, among others.

The market regulator has been facing impediments on its investigation and enforcement powers with regard to protecting investments by attachment of assets. It has also faced challenges to enforcement and implementation of its orders, the official said.

In addition, Sebi has been facing restrictions in taking necessary actions against market manipulators as it lacks effective power of search and seizure, and lack of power to call for information from any person in relation to enquiry or investigation.

Sebi had last sought amendments to the Securities Laws in 2009.

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