New Amendments to SEBI Act will help curb issues w.r.t Insider Trading

The amendments made in the SEBI Act enabling it to access the records has now given powers to SEBI to enforce insider trading charges. At the same time the powers has got enhanced to a greater extent including the right to search and seizure.

“This (access to call records) was a very important requirement.
There has been a clarification on one thing that SEBI had never sought and have no intention to seek power of interception of any conversation. Only intention is whether you have spoken to a person twenty times in a day or for twenty days you have not spoken so,how many times who has spoken to whom that helps us in (proving) serious offences like market manipulation, insider trading and front running by mutual funds.

Further action will bring persons outside securities markets, such as bureaucrats, within ambit of insider trading regulations. “The committee has given examples that a policy decision being taken about a particular area is price sensitive. What we are looking at is that whether our current regulations also capture this kind of people having unpublished information. The new insider trading rules as well as new guidelines on delisting could be approved at the next board meeting.

Procedures had been put in place so that penalties would be same under similar circumstances.

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eMinds Legal is a Corporate Law Firm based in Gurgaon, India specializing in Corporate Legal, Corporate Secretarial and Compliance. The Firm comprises of a team of Corporate Lawyers and Company Secretaries with in-depth subject matter knowledge and participative industry experience of over 15 years.

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