Vital papers missing in CRB case

Even as the Central Bureau of Investigation (CBI) has begun a preliminary enquiry (PE) against Pratip Kar, executive director of the Securities and Exchange Board of India (SEBI), for his alleged involvement in sanctioning a mutual fund licence to the defunct CRB group, some of the crucial files pertaining to Kar’s controversial decision are believed to be missing from the SEBI’s offices. After the CBI started the enquiry, the market regulator realised that the concerned files were not traceable. Both CBI and SEBI had received – from an anonymous source – some `missing’ documents in which Kar has overruled, in his handwriting, objections of a junior officer pertaining to the setting up of a mutual fund. “I’m willing to face any enquiry by any agency,” Kar told The Indian Express. “I have the conviction that I have done nothing wrong or illegal. I have nothing to fear and I am willing to face any enquiry,” he said.The mutual fund licence to the CRB group had raised eyebrows at thattime as the financial position of the group was extremely precarious. The group had later gone bust and its chairman C R Bhansali is now out on bail. Thousands of investors had lost over Rs 1,0000000000 in fixed deposits and debenture issues of the CRB group. After a prolonged enquiry, the CBI has moved the Pratip Kar case from its economic offences cell to the anti-corruption wing as Kar had allegedly used his official position in sanctioning the licence. After the preliminary enquiry against Kar, if the CBI gets necessary evidence, another formal investigation would be conducted and a chargesheet would be filed for prosecution. Kar claimed the registration and the in-principle approval was granted after careful analysis of the application and on ensuring that the eligibility criteria under regulation 8 of the SEBI regulations on mutual funds, 1993 were fully met. "The final approval was granted by the then SEBI chairman G V Ramakrishna," Kar said. Unfortunately, it was Ramakrishna’s successor and thepresent chairman of SEBI, D R Mehta who had to face intense critisism for the failure of the regulatory body. SEBI sources say that they are unable to conduct another enquiry against Kar as a CBI enquiry is already going on against him. "We cannot conduct a parallel investigation as the CBI enquiry gets precedence," sources said. "Unlike other SEBI officers, Kar began his work SEBI itself hence he cannot be reverted back," sources said. But Kar has been transferred to the `secondary markets’ department from the mutual funds department because of his alleged role in the CRB scam. Meanwhile, the CBI is also looking at the role played by some SEBI officials in renting premises by giving multi-crore deposits which were more than the market rents. Six apartments were rented by the SEBI for its executive directors in which deposits were paid in0000000. CBI has asked SEBI to furnish more details about the apartments so that proper investigation can be carried out.