SAT spikes Arora interim relief plea

Sebi investigating insider charges against ex-Alliance CIO

The Securities Appellate Tribunal (SAT) has turned down former Alliance Capital chief investment officer Samir Arora's plea for interim relief in the ongoing investigations aganst him by the Securities and Exchange Board of India (Sebi) for alleged insider trading.

Arora has been barred from any dealings in the securities markets, at least until the Sebi investigations are over. Sebi has made out a prima facie case of insider trading against him.

Today, SAT said that Sebi should make all efforts to pass to the final order by February 28, 2004 and "in any case to stick to the deadline of March 31, 2004."

In the last hearing, Sebi has given an assurance that the investigations will be completed by December 31, 2003 and the final orders passed by March 2004.

The appellate authority pointed out that the directive passed by Sebi "should be used only in rare and extraordinary situations," but at the same time, "it is incumbent upon the market players themselves to take due care and caution so as not to invite this agony on themselves."

According to Sebi, Arora, who was also one of the bidders for Alliance early last year, had made it known to the public that he would be exiting from the fund.

This uncertainty caused a large scale redemption from the fund and investors faced a loss of Rs 1,300 crore, Sebi pointed out. The probe also said that Arora had managed the equity schemes of Alliance in a non-transparent manner.

Further, Arora reportedly traded in the scrips of Digtal GlobalSoft (DGS) "on the basis of unpublished price sensitive information pertaining to the merger of Hewlet Packards's HPS-ISO division with DGS.

It also said that Alliance and the sub-accounts of Alliance Capital Management did not make declarations to the companies concerned when their combined shareholdings crossed the threshold limit of 5 per cent in Balaji Telefilms, Digital, Mastek, Hinduja TMT and United Phosphorus.