Sebi finds ex-tata Fin MD Pendse guilty

PENDSE REFUTED ALL CHARGES, INCLUDING FRAUD, BUT HE HAD TO SPEND SOME TIME IN JAIL

MUMBAI: In a high-profile case dating back to over 12 years, the Securities and Exchange Board of India (Sebi) has found that former Tata Finance managing director Dilip Pendse had executed “illegal transactions” in stocks of four companies including Infosys and the erstwhile Telco. The order prohibits Pendse from accessing capital markets for two years.

The order, passed on Monday, comes into effect immediately, but the regulator said the period of prohibition already undergone by Pendse (imposed by an earlier order dated December 24, 2012) would be set off against the new directive.

Amid a public spat between him and the Tata Group, Pendse was removed as MD in 2001 after a company subsidiary ran huge mark-to-market losses and the group filed criminal charges against him.

Sebi passed the latest order after Securities Appellate Tribunal on April 16 quashed Sebi’s earlier directive against Pendse and asked the regulator to pass a fresh order “on merits and in accordance with law as expeditiously as possible and in any event within six months”.

Sebi began its probe after Tata Finance complained in October 2002 about Pendse con ducting “illegal transactions in stocks of Himachal Futuristic Communications Ltd, Tata Engineering and Locomotive Company Ltd (now Tata Motors) Infosys and Software Solutions India Ltd. These transactions were conducted by him in complicity with two brokers, Jhunjhunwala Stockbrokers Pvt Ltd and Pratik Stock Vision, and on behalf of Inshaallah Investments.