Securities & Exchange Board of India chairman CB Bhave said the investigation into incidents of price-rigging carried out by his agency and investigations by other government departments are cleaning up the rot in the market that would protect investors. "Investors should be happy that the market is getting cleaned up," Bhave said. "There is no need for investors to be nervous. Investors should be happy that wrong-doers are caught."
Investor confidence in markets has been ruffled in the past few weeks with the Central Bureau of Investigation arresting some bank officials on charges of corruption, including the LIC Housing Finance chief executive. SEBI had charged promoters and brokers of rigging stock prices.
The Intelligence Bureau had reportedly passed on information to the market regulator about some brokers' involvement in price manipulation in specific stocks.
"We are on the job of investigation... all the time coordinating with other government agencies," said Bhave without getting into the specifics of the operation.
Indian shares which have fallen 7% since its recent peak, rose on Friday. The 30-share BSE Sensex, rose 266.53 points, or 1.39%, to 19,508.89.
Reports of widening investigation by several agencies dragged down many shares such as that of KS Oils , Ruchi Soya Industries and Karuturi Global during the week.
Prior to that, SEBI penalised promoters of companies such as Murli Industries , Welspun and real estate developer Ackruti City for colluding with stock broker Sanjay Dangi to manipulate share prices.
This was preceded by the arrest of seven officials from the Bank of India , Punjab National Bank and the chief executive of Money Matters, an intermediary in the loans market, for corruption. Some of them are out on bail.
Source:-http://economictimes.indiatimes.com/markets/regulation/SEBI-probe-into-rigging-will-clean-up-mkt-Bhave/articleshow/7079996.cms