The government today gave more powers to market regulator Sebi to crackdown on ponzi schemes, access phone call records to check insider trading and carry out search and seizure operations.
The Ordinance amending the Securities Laws was promulgated by President Pranab Mukherjee within a day of the Union Cabinet approving the proposal to give more powers to Securities and Exchange Board of India (Sebi).
"Government believes that these amendments would give Sebi the legal backing to clamp down on unscrupulous entities that are using newer methods to take gullible investors for a ride," an official statement said.
Amid rising criticism that enough is not being done to curb ponzi schemes, the government said: "the promulgation of the Ordinance demonstrates the firm commitment and resolve of the government to act with speed and alacrity to curb irregularities and frauds in securities market".
As per the amended law, Sebi can regulate any money pooling scheme worth Rs 100 crore or more and attach assets in cases of non-compliance, it said adding the Sebi Chairman would have the authority to order "search and seizure operations".
The market watchdog, the statement said, would now have powers to seek information, such as telephone call data records, from any persons or entities in respect to any securities transaction being investigated by it.
