Stock-market fraud: HC stays FIR against ex-SEBI chief Madhabi Buch
What's the story
The Bombay High Court has stayed a special court's order directing an FIR against former Securities and Exchange Board of India (SEBI) Chairperson, Madhabi Puri Buch.
The stay will be effective for four weeks.
Justice Shivkumar Dige, in his order, said the special court's order was passed without due application of mind and did not mention any specific role of the accused in an alleged stock market fraud.
Accused individuals
Who are the other accused?
The ruling was given on petitions filed by Buch, three current SEBI directors—Ashwani Bhatia, Ananth Narayan G and Kamlesh Chandra Varshney—and two Bombay Stock Exchange (BSE) officials.
The officials are managing director Sundararaman Ramamurthy and former chairman Pramod Agarwal.
The petitioners had sought to annul the order directing the Anti-Corruption Bureau (ACB) to file an FIR against them for alleged fraud during a company's 1994 BSE listing.
Historical context
Allegations stem from 1994 company listing
The case stemmed from a complaint by journalist Sapan Shrivastava, who alleged massive financial fraud and regulatory violations during a company's 1994 listing on the BSE.
He accused SEBI officials of facilitating market manipulation by approving the listing without adhering to the SEBI Act, 1992.
Reacting to the developments, SEBI announced its plan to legally challenge the order.
Regulatory response
BSE dismisses allegations as 'frivolous and vexatious'
The BSE has also rejected the complaint as "frivolous and vexatious."
Buch, who recently finished her three-year term amid controversy including conflict of interest allegations over Hindenburg Research's claims about her investment history, has denied the allegations.
She claims her investments were made before her SEBI appointment.