There is bad news regarding investigation into the 2000 scam. For the past six years, after it was found that Kolkata-based stock operators played a big role in manipulating share prices, the Kolkata police has been doggedly pursuing the cases against Dinesh Dalmia of DSQ Software and cronies of Ketan Parekh, the key accused without outside prompting. Action was initiated against all major price manipulators, while Ashok Poddar and Rabindra Biyani who allegedly routed Parekh’s money through the unofficial market, were declared proclaimed offenders. Dalmia himself was absconding from India for several years, but when he returned recently after duping investors in the US and UK of an estimated $125 million, the Kolkata police was hot on his trail again. All that may end soon. The team leader, Swapan Dasgupta, has been transferred out of the scam investigation cell on a promotion as Assistant Commissioner of Police. While Dasgupta’s promotion is indeed well deserved, it is a sad day for the investigation, especially with the Dalmia appeal scheduled to come up before the Supreme Court on January 3. Jubilant scamsters claim credit for Dasgupta’s transfer and threw a bash at a five star hotel to celebrate his exit. Those who have followed the investigation say that a change in attitude is already evident.

Capacity building

Ever since the Securities and Exchange Board of India (Sebi) began to register, recognise and interact with investor associations on capital market issues, it has struggled to find more than a dozen associations worthy of recognition. At one time, the number was down to nine. It was often said that the pathetic state of investor affairs was reflected in the fact that India has 23 recognised bourses but only nine investor associations. This year, Sebi has set a record by recognising as many as 17 investor associations including one each from Assam, Orissa and West Bengal. This is the first time that associations from eastern India have been drawn in through a capacity building effort. That chairman Damodaran is a Tripura cadre bureaucrat was probably an added interest to focus on the region. Interestingly, although Kolkata was always an active trading centre it had turned into a speculators’ haven in the last couple of decades. There has been very little organised investor activism from the city. That may now be in for a change. Sebi has also chalked out plans to bring investor groups from smaller locations up to the scratch by sending them to a training session at the Indian Institute of Capital Markets, which it is in the process of taking over. Incidentally, all 17 associations passed unanimous resolutions supporting Sebi’s plan to make IPO grading mandatory, asking the regulator not to eliminate the retail investor quota in IPOs and to rationalise demat charges in order to reduce the burden on investors.

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