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Updated: December 12, 2010 11:30 IST

Sebi awaiting government nod for phone tapping

PTI
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SEBI chief C. B. Bhave. File photo
PTI SEBI chief C. B. Bhave. File photo

A request is currently pending for over two months by Sebi to allow it intercept call records of certain individuals in connection with its probe into stock market manipulations

Phone tapping by the country’s tax authorities may have created a major controversy, but the capital market watchdog Sebi is not authorised to intercept calls and is awaiting the government’s permission for years.

Only a select few enforcement agencies, including the tax department, are authorised to tap telephonic conversations in their investigations and surveillance actions and the Securities and Exchange Board of India (Sebi) has requested for its inclusion in this list several times over many years.

However, all its requests have been turned down so far, the last time being in December 2009, when the Department of Telecommunications communicated to Sebi that it was not authorised to tap phones, a senior official said.

A request is currently pending for over two months by Sebi to allow it intercept call records of certain individuals in connection with its probe into stock market manipulations, the official added.

A major controversy has erupted after leak of hundreds of tapped phone conversations corporate lobbyist Niira Radia had with her clients, staff and various other people.

It has been said that various enforcement agencies together tap about 6,000-8,000 telephonic conversations at any given time on an average, but only a small percentage of that is for corporate or white-collar investigations.

Although Sebi has used call records in its investigations in the past, but in those cases the call records were collected by tax authorities or other enforcement agencies.

Sebi gets hold of these call records in cases where other agencies fall upon information suggesting market-related offences, the official said.

The government permits interception and monitoring of calls by select authorised entities as per the Indian Telegraph Act, 1885.

Incidentally, Sebi recently declined to part with information under Right to Information (RTI) Act about its correspondences with Finance Ministry and other government departments and ministries in connection to its request for being appointed as an authorised agency for phone tapping.

Sebi’s stance was also ratified by the Sebi Appelate Authrority, which was later approached by the RTI applicant.

Sebi had said that the information was strategic in nature and it pertained to its surveillance and investigation techniques.

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