SEBI says, don’t have info on surveillance system and prosecution!

The capital market regulator has spent crores of rupees, twice, over sophisticated real time market surveillance systems to track stock price manipulation. Yet, it says it has no statistics on the surveillance!

In a shocking disclosure, the Securities Exchange Board of India (SEBI) says that it does not have information relating to its market surveillance system! This was in response to an RTI filed by Moneylife. Moneylife had filed an RTI on 9 April 2013, requesting information on SEBI’s surveillance statistics and had asked SEBI how many suspicious cases its sophisticated Integrated Market Surveillance System (IMSS) and Data Warehousing Business Intelligence System (DWBIS) had detected till 31 March 2013. Our questions were simple:

  1. How many detected cases had resulted in prosecution
  2. How many detected cases had resulted in consent orders
  3. How many detected cases were dismissed due to lack of evidence
  4. How many detected cases are still pending for investigation

Well, it seems the regulator did not have such information with it! SEBI vide its reply no CPIO/AKS/AJ/325-2013/10853, stated, “It is informed that the information sought by you is not available with the concerned department of SEBI.” How is this even possible? If the surveillance department does not have such information, then who has it? Who is really in charge of monitoring the data captured by the surveillance department?


SEBI has spent over a whopping Rs50 crore in the so called “state-of-the-art” surveillance systems: IMSS and the more modern DWBIS. Earlier, SEBI had touted that the DWBIS project will “exploit the power of modern technology in terms of computation and speed of data analysis” and “host pattern recognition algorithms” to crack insider trading. Despite all this hype and talk and the enormous amount of money spent, stock manipulation still continues, right under SEBI’s nose.

Even now, Moneylife routinely comes across companies, mostly with poor fundamentals and past track record of transgressions, whose share prices brazenly manipulated, in no time, putting minority shareholders at a disadvantage. For instance, Moneylife wrote that Nucent Estates (Unquoted section of Moneylife issue dated 16 May 2013) went up a whopping 742% from just Rs1.28 to Rs10.78 in just one year. The company had earlier failed to comply with Bombay Stock Exchange (BSE) corporate governance norms. It even changed its name, a common tactic adopted by companies to disguise their past transgressions. Similarly, Kelvin Fincap (Moneylife issue dated 2 May 2013) rose 549% within a year after BSE had revoked its suspension! There are numerous cases which Moneylife has written about. Do check out the Unquoted section of the magazine and website ( You will be alarmed and surprised at the ease of how company share prices can be manipulated. Moneylife even did a cover story on this (which can be accessed here: Stock Manipulation). Even stock exchanges such as National Stock Exchange (NSE) and Bombay Stock Exchange (BSE) do little. So much for SEBI spending huge amount of tax payers’ money on this surveillance system!

Moneylife had found out that 48 staff members are posted in the Integrated Surveillance Department (ISD) of SEBI, which houses the IMSS and DWBIS system, as of 31 March 2013. The IMSS contract value was found out to be Rs20.55 crore, out of which Rs6.52 crore went towards “capital expenditure” between 2007 and 2010. HCL Technologies was the vendor.

Then SEBI adopted another system known as DWBIS, which came into existence from 2010 onwards, and the contract value was found to be Rs34.38 crore and Tata Consultancy Service (TCS) is the new vendor. Out of this amount, over Rs11 crore has gone towards “capital expenditure” in the last two years alone. This is collectively over Rs50 crore of taxpayers’ money.

This is a lot of taxpayers’ money and nobody knows if SEBI is truly looking at cases triggered by the systems, if at all, let alone punishing offenders and compensating minority shareholders. Nobody knows how effective SEBI’s surveillance system is either. It is even more shocking that the surveillance department of SEBI do not have the information with them.

Moneylife has filed a first appeal before the First Appellate Authority at SEBI.




3 years ago

You are saying about SBI is fine but what about the Stock Market, where the pendulum swings with money bags and all is legal.

B Pugazhendhi

3 years ago

The statistics may not be really available. But we may ask them whether any report or compilation or analysis about suspecious transactions are available. They cannot give any ambiguous reply for such a query. By the way the way, did Money life file any appeal?


3 years ago

In yesterdays economic times supplement ,read article written by Devdutt Pattanaik, where in it has been mentioned that,"When shareholder only thinks targets & the regulator only thinks rules,the market suffers.People,pushed to a corner,end up bending & breaking the rules.Often the policeman & the judge in creating too many rules ends up encouraging criminals,because good people are too scared to work."

Sushil Maheshwari

3 years ago

It proves SEBI themselves are doing scam. It means do we need another regulator to monitor SEBI, who are just whimsical and do not own any responsibility,


Dayananda Kamath k

In Reply to Sushil Maheshwari 3 years ago

you are 100% right. in india regulators are the biggest manipulators whether it is rbi, sebi, irda. cvc or cbi. because they are appointed by reckless casual political bosses. and that will serve their purpose of looting the country.every head of regulators appointment is controversial and open secret that they are appointed to cover up their own misdeeds.


3 years ago

forget about the small shares, look at shares of reliance communication in past 50 days, look at closely the minute to minute pattern of trading . you will realize the insider trading and stock manipulation happening.


3 years ago

Good work done by Moneylife. To me, SEBI’s response is not surprising. It reflects, and, is in line with the way SEBI work’s (or don’t) and hides information.
I would request Moneylife to introduce a RTI page; Readers can suggest RTI queries and some of them can file these to CPIO or appropriate authority seeking information under the RTI Act. The responses would startle most of you. It will expose the lip service of authorities to investor protection.

For starters, I propose that the following information may be sought under RTI from SEBI:

1. The present status and action taken by SEBI, Ministry of Corporate Affairs and CMC on the potential vanishing companies list submitted by Midas Touch Investors Association of:
(a) 604 companies in 2003 (which was also submitted by BSE)
(b) 150 companies or thereabouts submitted in 1999 alongwith investor grievances
(c) List submitted by any other organistion or association.

Virendra Jain
Midas Touch Investors Association

arun adalja

3 years ago

our regulatories are wasting public money for not doing job in a proper way.they must be sacked immediately without any delay.they have to regulate the market and take strict against the people who are doing mal practices.

shailesh gandhi

3 years ago

Unfortunately this is representative of how ineffective many surveillance and vigilance systems are. They are put up as a routine, with no real intention or will to do the job. Moneylife has taken the lead; citizens must keep monitoring various activities and asking for accountability.

uttamkumar dubey

3 years ago

I would like to name a very popular and fake company called Resurgere Minerals and mines.its controlled n managed by Subhash sharma.

Many ppl have lost their wealth in it.But as usual the blind and corrupt system/rulers of the nation have sold out everyth from the nation and are busy maintaining their swiss account.

uttamkumar dubey

3 years ago

I believe "WILL" is more important than any "surveillance system".

And none of the public fund companies are doing justice to the people of the nation and neither to their job and nor to humanity.

Its time Kejriwal should run the politics of the nation and Moneylife should look into financial aspect of the nation.

Great job Moneylife,keep the nation in the loop... Pls oppose fake bharat nirman and boycott such ppl.

Request moneylife to have special edition wherein we know the shameless face of the nation, we would try our best to make it reach to the masses.


3 years ago

I entered into an F&O contract (GMR Infra) thru the franchisee(Kakinada) of a broker of Hyderabad in 2008. But, soon I learnt that the scrip was banned by the NSE then. Immediately I tried to verify the Transaction (Ref.No. in contract note given by the broker in email) in NSE site, but to my utter dismay, it is not found.

I complained to SEBI thru' email the entire eposide with all the referencce numbers.

But, they simply sent reply to approach their Chennai Office with all the proofs, which I do not have other than the electronic related data, which I have already submitted to them.

Bosco Menezes

3 years ago

And it appears that it is this inability of SEBI & the stock exchanges to curb manipulation with their expensive surveillance systems that has resulted in the biggest disaster visited upon Indian investors - PCAS (Periodic Call Auction System) - applied to more than half of all active stocks on the BSE.
PCAS , instead of curbing manipulation, has curbed trading itself in PCAS scrips. Perfectly liquid scrips (though they might have not being doing 10K shares traded daily) have been now actually been made illiquid, leaving majority of investors stuck - their hard
earned money of many years of effort is now just an electronic entry in a demat statement with no way to encash the same.
What if an investor requires to encash his holdings for a medical emergency ? Or for a child's marriage ? Or to make a payment on the flat he has booked ? .
Truly, ordinary people have been dealt a hammerblow by SEBI with the PCAs system.
Just a few weeks ago the Supreme Court rejected the PIL to stay the IPL playoffs ....
saying spot fixing by individuals cannot be a resaon to ban IPL. Cannot SEBI realise that that manipulation by few
operators cannot be a reason to shut down the small cap market & harm crores of investors ?

Ashok Visvanathan

3 years ago

They have the statistics, but are probably ashamed to reveal it. The best surveillance is revealing Seller buyer identities on the screen. In the days of floor trading all brokers knew which share was being manipulated, and would tell you. Now SEBI may know but will say they cant tell you as it is unethical to do so. This is progress !

Jose Koshy

3 years ago

This is crazy, how can SEBI wash its hands off. Guess its with the finance ministry..This must be taken up with a PIL in Supreme Court and expose. Am sure if the answers for your questions are exposed, many heads in SEBI will roll as they would not have taken actions ! Great work MoneyLife..file a PIL. Don't let them go scott free.

R Balakrishnan

3 years ago

Cleverly drafted reply. Perhaps some other department has it. Read the response:
“It is informed that the information sought by you is not available with the concerned department of SEBI.”
Maybe it is available with someone else at SEBI?
Investors are perhaps better off without this agency, which is more like a coroner.

RBI extends restriction on co-op banks for loan against gold coins

In a notification, the RBI said while granting advance against the security of specially minted gold coins sold by banks, co-operative banks “should ensure that the weight of the coin(s) does not exceed 50 grams per customer”

The Reserve Bank of India (RBI) has extended the restriction on advance against gold on co-operative banks as well, a move aimed at curbing demand for gold.


In a notification, the RBI said while granting advance against the security of specially minted gold coins sold by banks, state/central co-operative banks “should ensure that the weight of the coin(s) does not exceed 50 grams per customer”.


Also the amount of loan to any customer against gold ornaments, gold jewellery and gold coins (weighing up to 50 grams) should be within the board approved limit, it added.


Earlier, similar restrictions were imposed on commercial banks.


The RBI’s latest move comes in the backdrop of government raising import duty on gold to 8% from 6%.


The central bank has also advised banks not to sell gold coins, finance minister P Chidambaram said yesterday.


RBI has also imposed restrictions on gold imports by banks.


Surge in gold imports has become a cause of concern for both the government as well as the RBI as it putting pressure on the current account deficit, which is likely to be around 5 per cent of the GDP in 2012-13.


RTI Judgement Series: Transferring of Delhi’s 'monkey menace' to the villages

Monkeys caught in Delhi were released in the Asola Wild Life Sanctuary, which the appellant claimed was beyond the capacity of the sanctuary. The CIC directed the PIO to facilitate inspection of the sanctuary by the appellant. This is the 109th in a series of important judgements given by former Central Information Commissioner Shailesh Gandhi that can be used or quoted in an RTI application

The Central Information Commission (CIC), while disposing an appeal, directed the Public Information Officer (PIO) and deputy conservator of forest (South) of Forest & Wildlife Department (FWD) at the Government of National Capital Territory of Delhi (GNCTD), to facilitate an inspection of Asola Wild Life Sanctuary by the appellant.


While giving this judgement on 16 June 2011, Shailesh Gandhi, the then Central Information Commissioner said, “The appellant and the respondent have agreed that the appellant will visit and inspect the sanctuary on 16 June 2010 from 10.00am onwards. The PIO will facilitate an inspection by the appellant on that day.”


New Delhi resident Om Prakash Tanwar, on 6 August 2009, sought information about monkeys being caught in Delhi and released in the sanctuary from the Public Information Officer (PIO) of the FWD. Here is the information he sought under the Right to Information (RTI) Act and reply provided by the PIO...


a. Approval letter of NGOs/RWA of the area from where monkeys have been taken into possession for release in forest of Tughlakabad range in the last five years.       

PIO's reply: No such reports available on record.


b. Copy of delivery receipts issued by the department to MCD and NDMC whenever monkeys were delivered in the aforementioned area in the abovementioned time period.      

PIO's reply: Copy of such receipts not maintained. Same may be obtained from the Veterinary Department of MCD.


c. Areas where monkeys are kept, if open then the mechanism used to stop them from fleeing the forest area.         

PIO's reply: The object of releasing them is to rehabilitate them in natural habitat and not subject them to any restraint.


d. Details of last five years as to date of visit of officials (name/ designation/ vehicle number) to catch monkeys in the area and total number caught.     

PIO's reply: No monkeys have been caught by this Department.


e. Number of monkeys present in forest area and total number that have fled.  

PIO's reply: No such reports available on record.


f. Number of people engaged in looking after the monkeys, names, designation and salaries of the last five years.       

PIO's reply: No person specifically deputed to look after the monkeys. However, they are fed by 15-20 labourers who are supervised by. Dharam Singh, Dy. Range Officer, Asola Bhatti range and Shri Kesar Singh, Forest Guard, Mali. Salaries drawn cannot be disclosed.


g. Expenses incurred in keeping monkeys alive in forest range in the last five years.

PIO's reply: Requisite information already provided. Inspection of the books of account maybe done and copies be obtained.


h. Number of water ponds, reservoirs created for providing drinking water to the monkeys.  

PIO's reply: None has been created.


i. Copies of original bills submitted by suppliers to the department for release of payment against feeding material for monkeys.     

PIO's reply: Same as (g) above.


j. Number of suppliers supplying feeding materials. Specify owners name, address and reasons for selecting these agencies only for the supply.

PIO's reply: Feed is procured from Kendriya Bhandar (grains/cereals) and from APMC, Azadpur(Fruits/vegetables). Procurement is being done from being reputed suppliers at reasonable rates.


k. Any publishing done by the department inviting open tender from the market with respect to supply feeding material for the monkeys in forest area.   

PIO's reply: NO


l. Inspection of entire files relating to supply of feeding material bills, receipts etc, and also of living conditions of the monkeys and new monkeys coming from different parts of Delhi.    

PIO's reply: Relevant records may be perused on any working day in office. Current file relating to procurement if unavailable due to being in submission before a higher authority shall be made available immediately on receipt of the same.


Claiming that the PIO did not reply within the mandated 30 days as per the RTI Act, Tanwar, the applicant filed his first appeal. The First Appellate Authority (FAA) in his order asked the deputy conservator of forest for south and PIO to make arrangement for inspection of the concerned files/records by Tanwar.


Still not satisfied with the information provided by the PIO, the applicant approached the CIC with his second appeal.


During the hearing, Mr Gandhi, the then CIC, noted that the PIO has provided the information to Tanwar. However, after the inspection and obtaining the information, Tanwar, the appellant had serious problem with “transferring Delhi's problem to villagers”.

The PIO stated that as per the order from the high court, monkeys were being caught in Delhi and released in Asola Wild Life Sanctuary, which has an area of 7,000 acres. The total number of monkeys released in the sanctuary so far was over 12,000, which was in excess of the carrying capacity of the sanctuary.


To this, Tanwar stated that “These monkeys are now harassing the villagers around the sanctuary and the exercise appears to be transferring Delhi’s problems to villagers.”


He said he would like to inspect the sanctuary to see the condition for which permission had been granted by the Chief Wild Life Warden, however due to a communication gap, he could not inspect it.


Both the appellant and the PIO agreed that Tanwar would visit the sanctuary for inspection on 16 June 2010. He would meet Dharam Singh, deputy range officer at Bhatti Range Office on the day. The PIO also pointed out that the monkeys in the wild life sanctuary can at times be violent and there may be some danger in visiting the sanctuary. Tanwar stated that he understood this.


While disposing the appeal, Mr Gandhi directed the PIO to facilitate an inspection by the appellant on 16 June 2010.




Decision No. CIC/SG/A/2010/001052/8124

Appeal No. CIC/SG/A/2010/001052


Appellant                                          : Om Prakash Tanwar

                                                            New Delhi- 110074.


Respondent                                       : Prabhat Tyagi

                                                            Public Information Officer &  

                                                            Dy. Conservator of Forest (South)

                                                            Forest & Wildlife Department,

                                                            Government of NCT of Delhi,

                                                            Near Karni Singh Shooting Range,

                                                            Tughlaqabad, New Delhi-44.


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