SEBI confirms order on Samir Arora

MUMBAI SEPT. 24. The Securities and Exchange Board of India today confirmed its earlier order prohibiting Samir Arora, fund manager of Alliance Capital Mutual Fund, from buying, selling or dealing in securities till further orders and said, "It will take appropriate action against the MF's directors/trustees on conclusion of investigations.'' Following SEBI's August 9 order, Alliance Capital suspended Mr. Arora from research and portfolio management activity. It was also observed that he would continue to be paid through late September as previously agreed to, after which time his employment will end, the SEBI wholetime member, T. M. Nagarajan, said in his order issued here. "This action, on the part of Alliance Capital, however, will not mitigate the need to go into the issue of accountability of directors and trustees and on conclusion of the investigations, appropriate actions shall be taken against them for any violation of SEBI regulations,'' he said. Mr. Arora has contended that the trustees and directors of the mutual fund were kept regularly updated and informed on both strategy and details of stocks purchased by the fund and could be sought by them at will. This raised the issue of their accountability, Mr. Nagarajan said. "While the fund manager or CIO of a MF may be given professional freedom of day to day operations, the board should ensure that he functions under its overall control, direction and supervision. In the instant case, a periodical diligent review of the style and strategy of the Fund Manager could have enabled the board to take necessary remedial action,'' he added. — PTI