Probe ordered against management of MSEI: Minister

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New Delhi, Aug 3 (IANS) The Securities and Exchange Board of India (SEBI) has ordered an inquiry into allegations of mismanagement, flouting of rules and siphoning of funds against the management of Metropolitan Stock Exchange of India Ltd (MSEI), Parliament was told on Friday.

In a written reply to a question, Minister of State for Finance Pon Radhakrishnan told the Lok Sabha that the government as well as the SEBI, the regulator for securities market in India, had received complaints from two whistleblowers about irregularities and fraud at MSEI.

“The complaints have been examined in detail by SEBI and as an interim measure, directions have been issued to the governing board of MSEI, inter alia, to constitute a Committee of Public Interest Directors (PIDs) to examine all the allegations levelled by whistleblowers against the management of MSEI,” he said.

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Radhakrishnan added that based on the recommendations of the committee, SEBI will take suitable action against the entities and persons found to be involved in the malpractices.

In their complaints, the two whistleblowers levelled allegations against officials of the exchange, including the Managing Director and CEO, regarding mismanagement, flouting of rules and laws, personnel-related issues, and siphoning and misappropriation of funds.

“MSEI has engaged the services of forensic auditor for the purpose of examination, including assessing the actual magnitude of fraud. Allegations against brokers are (being) separately looked into,” the Minister said.

“Further, the MD and CEO of MSEI has been directed to proceed on an indefinite leave to ensure fair and uninterrupted examination of the charges levelled in the complaints of the whistleblowers,” he added.

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–IANS

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