By Venkatesh Raghavan
Mumbai: Market observers have expressed uncertainty on whether the former Managing Director of National Stock Exchange (NSE) Ravi Narain, who is currently in London along with his family, might choose to flee Indian shores for good akin to previous defaulters like Nirav Modi. Such speculations are rife since the nodal agency CBI’s investigative reports keep questioning the alleged complicity of the market regulator Securities and Exchange Board of India (SEBI) in the National Stock Exchange’s (NSE’s) co-location scam.
The scam actually centres on the ex-MD and CEO of NSE Chitra Ramakrishna permitting a “Yogi”, considered a Himalayan sadhu, access to sensitive information including financial and business plans of the NSE. Furthermore, it was learnt from the complaints coming from whistleblowers that many brokers gained unfair access to NSE data that pertained to the promotion of algorithmic trading.
Currently, the Central Bureau of Investigation (CBI) which is probing the alleged irregularities that were reported from early 2013 till 2019 reported that there were major governance lapses that were pointed out by written communication from the whistleblowers. The CBI officers also disclosed that there is the likelihood of SEBI officials being called for questioning in this matter as they felt some of them were accomplices in the irregularities that were reported.
The lack of response on part of the SEBI officials in both, reporting the matters under scrutiny and also making due mention of it in their vigilance reports, has stirred a hornet’s nest.
The scam dates back to January 2015 when SEBI officials were alerted to the flaws detected in the NSE’s co-location system. It was a good two years before the market regulator sent show-cause notices to 14 NSE staffers in addition to former NSE MDs, Chitra Ramakrishna and Ravi Narain.
The point that was immediately under the scanner was Chitra Ramakrishna’s confession that she sought the advice and guidance of a Himalayan yogi in all financial matters pertaining to NSE, including its business dealings. The identity of the said mysterious yogi is still being debated, though many in the nodal investigative agency have nailed it as Anand Subramanian who was appointed at the behest of Chitra Ramakrishna as Group Operating Officer (GOO).
The questions that are raging right now centre on did the market regulator SEBI take timely and adequate action after the scam was brought to its notice and will former MD Ravi Narain escaped the dragnet of the CBI investigations, by refusing to return to Indian shores and taking shelter abroad. The union finance minister too has spelt out that the probity of the regulatory body will be duly examined.
It might be recalled that lookout circulars were issued against Chitra Ramakrishna, Anand Subramanian and Ravi Narain by the CBI team in late February. While Chitra Ramakrishna and Anand Subramanian have been remanded to custody, Ravi Narain is reportedly still at large with a likelihood of it turning into bolting of the stables after the horse has fled. The CBI officers were, however, tight-lipped on the exact nature of complicity that the alleged accomplices from SEBI were wrought guilty of.
