SAT SETS ASIDE SEBI ORDERS vs. NSDL & CDSL

In yet another instance of the market regulator's order not standing the test of a higher tribunal, the Securities Appellate Tribunal (SAT) has set aside SEBI's order against the two depositories-NSDL and CDSL - for their alleged negligence and for not taking appropriate action against erring depository participants. The case deals with SEBI's investigations in the matter of 21 IPOs that hit the market during the period between 2003 and 2005. SEBI's probe revealed that shares that were reserved for retail investors were illegally acquired by various entities through the thousands of fictitious/benami applications. Key operators' opened a large number of demat accounts in fictitious and benami names and used those to submit applications for shares in the IPOs in the retail category.