CBI arrests ex-NSE MD Chitra Ramkrishna in co-location scam

Mumbai: The CBI on Sunday arrested Chitra Ramkrishna, the former MD and CEO of the National Stock Exchange, in an alleged stock market manipulation case, which included sharing privileged information to a person whom she dubbed as "Himalayan Yogi."

As per a report by PTI, Ramkrishna was arrested in Delhi and was taken for a medical checkup.

She was later lodged in lockup at the CBI headquarters, officials said.

The arrest came just a day after a Delhi Court dismissed her request for a pre-arrest bail plea and pulled up the Central Bureau of Investigation or CBI for inaction and being "lackadaisical" in the probe against her over the last four years.

According to the Securities and Exchange Board of India (SEBI), Chitra Ramkrishna shared information including the bourse's financial projections, business plans and board agenda with a purported spiritual guru in the Himalayas.

"The sharing of financial and business plans of NSE ... is a glaring, if not unimaginable, an act that could shake the very foundations of the stock exchange," SEBI said in an order.

During its investigation, SEBI had found documents showing Ramkrishna's emails to an unknown person, who she said during questioning was a "spiritual force" she had sought guidance from for 20 years.

Ramkrishna, in her defence, told SEBI that sharing information with the person who was "spiritual in nature" did not compromise confidentiality or integrity.

The SEBI order however stated that it was "absurd" for Ramkrishna to contend that sharing sensitive information such as dividend pay-out ratios, business plans and the performance appraisals of NSE employees did not cause harm.

The SEBI probe also found the purported guru had substantial influence over the appointment of a mid-level executive, without any capital market experience, directly as an adviser to Ramkrishna with inadequate documentation and a salary higher than most senior NSE officials.

The guru was running the exchange, and Ramkrishna was "merely a puppet in his hands", SEBI said.

SEBI also said NSE and its board were aware of the exchange of confidential information but had chosen to "keep the matter under wraps".

The regulator fined NSE 20 million rupees ($270,000) and has barred the exchange from launching any new products for six months.

SEBI imposed a penalty of 30 million rupees on Ramkrishna and barred her from any bourse and SEBI-registered intermediary for three years.