NSE, two former CEOs and others face Sebi action

Mumbai: The Securities and Exchange Board of India on Friday penalised the National Stock Exchange (NSE), its former chief executives Chitra Ramkrishna and Ravi Narain, and two others for allegedly violating securities contract rules related to the appointment of Anand Subramanian as group operating officer and adviser to the managing director.

The capital markets regulator, in a 190-page order released late on Friday, also barred NSE from launching any new product for six months.

Sebi has imposed a fine of ₹3 crore on Ramkrishna, ₹2 crore each on the NSE, Narain and Subramanian and ₹6 lakh on VR Narasimhan, who was the chief regulatory and compliance officer.


The regulator has also restrained Ramkrishna and Subramanian from associating with any market infrastructure institution or intermediary for three years. Narain has been restrained for two years.

Several Complaints Received
Further, Sebi has directed the NSE to forfeit the excess leave encashment of ₹1.54 crore and deferred bonus of ₹2.83 crore of Ramkrishna and deposit the amount to its Investor Protection Fund Trust.

Ramkrishna was the managing director and CEO of the NSE from April 1, 2013 to December 2, 2016. Narain was the MD and CEO from April 1994 to March 31, 2013. Thereafter, he was appointed as vice-chairman on the NSE board.

Subramanian was the chief strategic adviser from April 1, 2013 and was re-designated as group operating officer and adviser to Ramkrishna from April 1, 2015 till October 21, 2016.

Sebi received several complaints against Subramanian's appointment, alleging that he was directly posted as a consultant to Ramkrishna with a pay of more than ₹4 crore per annum, higher than most of the senior officials at the NSE.

After Sebi asked the complaints to be placed before the NSE board, a report of the nomination and remuneration committee was submitted to the regulator.

The report observed that the only person who interviewed Subramanian for his appointment was Ramkrishna. While there are no notings in the personnel file of Subramanian in relation to his interview, the position of chief strategic adviser was neither advertised nor any other person was considered for the position, according to the report.

Sebi in its examination also found that Subramanian was offered the role of chief strategic adviser at an annual compensation of ₹1.68 crore for part-time working as a consultant for four days in a week. In his earlier organisation, he was drawing a compensation of only ₹15 lakh per annum.