Finance Ministry dismisses charges of interference in Sebi functioning

The Finance Ministry today dismissed allegations by a former Sebi member of interfering in the market regulator's job and termed the charges as "false, vexatious and defamatory".

The Finance Ministry today dismissed allegations by a former Sebi member of interfering in the market regulator's job and termed the charges as "false, vexatious and defamatory".

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The ministry further said that it has received numerous complaints against the official, KM Abraham, formerly Whole-Time Sebi Member, ranging from corruption to abuse of power.

In a three-page clarification issued late night, subsequent to reports of allegations by Sebi's former Whole-Time Member KM Abraham, the Finance Ministry said that the charges levelled against the finance minister and his Adviser were "devoid of any truth and are a complete distortion of facts".

The Finance Ministry said that it has received numerous complaints, including by several MPs, about his conduct, while references have been received from CVC and the Department of Personnel and Training (DoPT).

Abraham retired from Sebi last month and has lodged complaints with the Prime Minister about alleged interference by the Finance Ministry in the functioning of Sebi, including in cases relating to major corporate entities such as the two Reliance groups, ICICI-Bank of Rajasthan, MCX-SX and Sahara group.

In letter dated June 1 to Prime Minister Manmohan Singh, Abraham had complained that Sebi's current chairman UK Sinha told him that the Finance Ministry wanted the regulator to go slow in these cases.

The letter was forwarded to the Finance Ministry, which later sought response from Sinha on the issue.

Sinha denied any interference by the Finance Ministry in the market regulator's functioning and termed the allegations made by Abraham as baseless.

Terming these allegations as a "figment of imagination," Sinha wrote to the Finance Ministry on July 8 that Abraham was "suffering from persecution complex and delusion and is erratic in behaviour".