- Ramkrishna shared confidential information with a yogi.
- She got advice about crucial decisions from him.
- Bourse’s financial projections and business plans were shared with him.
MUMBAI: The former head of India’s largest stock exchange shared confidential information with a yogi and sought his advice on crucial decisions, a market regulator inquiry has found ahead of the exchange’s highly anticipated public listing.
In a case of “outlandish misconduct” that was an “outrageous violation” of regulations, Chitra Ramkrishna, the former chief executive of National Stock Exchange (NSE), shared information including the stock’s financial projections, business plans and governance agenda with an alleged spiritual guru in the Himalayas, the Securities and Exchange Board of India (SEBI) said.
“Sharing NSE’s financial and business plans […] is a glaring, if not unimaginable act that could shake the foundations of the exchange,” SEBI said in an injunction, punishing Ramkrishna, the exchange and other former top executives for the mistakes.
Ramkrishna, who quit NSE in 2016 citing “personal reasons”, was not immediately available for comment. NSE and SEBI did not respond to requests for comment.
Allegations of wrongdoing in corporate governance have haunted NSE for years. The exchange had planned to go public in 2017, but its listing was derailed by allegations that officials had given some high-frequency traders unfair access through co-location servers, which could speed up algorithmic trading.
After a three-year investigation, SEBI fined the exchange more than $90 million and banned it from raising money in the securities markets for six months. NSE has challenged the order in court and has sought SEBI’s approval to file a new IPO.
However, during that investigation, SEBI found documents containing Ramkrishna’s e-mails to an unknown person, whom she said during the interrogation was a “spiritual force” whom she had consulted for 20 years.
Ramkrishna, in her defense, told SEBI that sharing information with the person that was “spiritual in nature” did not compromise confidentiality or integrity.
However, the SEBI injunction stated that it was “absurd” for Ramkrishna to claim that sharing sensitive information such as dividend payout ratios, business plans and the performance ratings of NSE employees did not cause harm.
The SEBI investigation also found that the alleged guru had substantial influence over the appointment of a mid-level executive, without any capital market experience, directly as an adviser to Ramkrishna with insufficient documentation and a higher salary than most senior NSE officials. .
The guru ran the exchange and Ramkrishna was “just a puppet in his hands,” SEBI said.
Inquiries sent by email to an address listed in the SEBI order as belonging to the guru were not immediately answered.
SEBI also said that NSE and its board were aware of the confidential information exchange but had chosen to “keep the matter secret”.
The regulator fined NSE 20 million rupees ($270,000) and banned the exchange from launching new products for six months.
SEBI fined Ramkrishna 30 million rupees and banned her from any exchange and SEBI-registered intermediary for three years.
Ramkrishna was among a group of executives who started NSE in the early 1990s as a challenger to the more established BSE Ltd, then known as Bombay Stock Exchange. She was appointed joint managing director of NSE in 2009 and promoted to CEO in 2013.