After the Securities and Exchange Board of India (SEBI) recently discovered severe lapses in her governance and ethical conduct, the Income Tax department conducted raids at the Mumbai residence of Chitra Ramkrishna, the former chief of the National Stock Exchange of India (NSE).
Chitra Ramkrishna was MD and CEO of NSE from 2013 to 2016. She was ousted from NSE in 2016 for her role in the co-location and Algo trading scam besides abuse of power.
While sources in the IT department acknowledged the searches, they refused to provide any additional information while the operation was ongoing.
The searches, according to officials, are being conducted to investigate allegations of tax fraud and financial irregularities leveled against her and others. Raids on her residences in Chennai and other locations were also conducted.
Ramkrishna exchanged private information about the exchange with an unnamed person, according to a recent order from the SEBI, for which he was fined Rs 3 crore. Ramkrishna stated she was following a "Himalayan yogi's" advice.
'Siddha-purusha' or 'paramhansa,' her spiritual mentor for over 20 years, whom she addressed as 'rigyajursama' in her emails, she maintained during an internal investigation.
The order of regulator stated that “The sharing of financial and business plans of the NSE is a glaring, if not unimaginable, an act that could shake the very foundations of the stock exchange.”
Another severe blunder was the appointment of Anand Subramanian as a chief operating officer (COO) without the nomination and remuneration committee's (NRC) approval, which was a violation of regulatory guidelines. According to the SEBI ruling, Ramkrishna and Subramanian, as well as the unnamed 'Guru,' was involved in a "glaring conspiracy of a money-making scheme."
Last week, Ramakrishna made headlines when she admitted to sharing personal information with a yogi in the Himalayas and seeking his assistance on important matters.
Apart from that, Ramkrishna communicated with the yogi various internal secret information, such as NSE's financial and business strategies, dividend scenario, and financial outcomes, and even advised him on the exchange's employee performance reviews.
The alleged guru also had a significant impact on the choice of a mid-level employee with no capital market experience as Ramkrishna's adviser, with inadequate documentation and pay higher than other NSE officials, according to SEBI findings.
In May and July 2018, the NSE filed extensive findings to SEBI, claiming that the 'yogi' was Subramanian himself, an allegation backed up by the forensic auditor. SEBI, on the other hand, was not convinced.
Because the SEBI board failed to take action against Ramkrishna, the stock exchange regulator levied a penalty of Rs 2 crore on the NSE and prevented it from launching any new products for the following six months.
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