Even today, the market grapevine says that some leading market operators are able get confidential information on trading positions through internal sources. As for the capital market regulator, it not only leaks like a sieve, but some disgruntled employees have been posting a steady stream of letters alleging the worst kind of corruption on the part of their senior most surveillance officials. I have over 20 such letters, each making specific charges of corruption, deliberate bungling of investigations or refusal to check rampant price rigging in certain stocks. Each letter bears a name and address and Securities and Exchange Board of India (Sebi) officials spend considerable time and effort in establishing that the letters are fake or mischievous.

Unfortunately, Sebi still does not have a handle over price manipulation despite access to a powerful, inter-market surveillance system. Tracking and wooing chief finance officers of leading companies used to be an art in itself in the 1980s. Brokers considered themselves extraordinarily lucky if these officials deigned to trade through them, because their transactions were watched carefully for a clue into the company's performance. Automation of capital markets and insider trading regulations have ended this happy situation, but it has been replaced by select CFO clubs that meet at 5 star venues to discuss forthcoming corporate results.

Over the years, we have seen cabinet minutes, confidential reports and important decisions of key ministries leak out with alarming regularity to powerful corporate houses. These again are photocopied and sent out routinely as part of a retainer paid to some powerful "confidential" secretaries or under secretaries of important Union Ministers. The trade in Parliamentary questions and rates quoted for starred and unstarred questions has now been thoroughly exposed through media sting operations.

... contd.