The Role Of Sebi In Corporate Restructuring With Special Reference To Security Frauds In India
- IJLLR Journal
- Apr 19
- 2 min read
Pratham, BA LLB (H), Amity Law School, Amity University, Noida
Richa Yadav, Assistant Professor, Amity Law School, Amity University, Noida
ABSTRACT
The Indian capital market has transformed itself from an unstructured and unregulated one to a structured and regulated one in the 1990s and beyond with the rise of technology and globalisation. This transformation can be witnessed with the Securities and Exchange Board of India (SEBI), a statutory body dedicated to investor protection and monitoring securities markets, leading the charge in this sector. However, despite remarkable accomplishments, it would be naive to conclude that the Indian securities market is now free of fraud, insider trading or corporate malpractice, as demonstratedbyhigh-profilescandalsliketheHarshadMehtascam (1992), the Ketan Parekh scam (2001), the Satyam fraud (2009) and the NSEL crisis (2013).
This research paper focuses on the role of Securities Exchange Board of India (SEBI) in regulating corporate restructuring along with the prevention of securities fraud in contemporary India. It delves into the legal and institutional parameters defining SEBI’s functioning, traces the history of some of the biggest securities frauds and their consequent regulatory responses, and provides a comparative perspective on India’s regulatory architecture on securities market vis-a-vis those of the United States and the United Kingdom. The study underscores the SEBI’s achievements and limitations in enforcement, investor protection, and inter-agency coordination.
The paper identifies a number of key challenges, such as misuse of technology, delays in enforcement, jurisdictional overlaps and the lack of full protection for whistleblowers. These measures include limited prosecutorialpowerstoSEBI,creation ofacentralfinancialfraudtaskforce and an expansion of digital surveillance capabilities. By deploying both doctrinal and comparative legal methodology, the study argues in favour of a forward-looking regulatory strategy that can re-invent SEBI not merely as acompliancearmigerbutas aproactiveconstructoroffinancialstabilityand
ethical market conduct.
Keywords: SEBI, Corporate Restructuring, Securities Fraud, Investor Protection, NSEL Scam, Harshad Mehta, Ketan Parekh, Financial Regulation
