Cong. for JPC probe into pay-order scam

By Our Special Correspondent

NEW DELHI, MARCH 31. The Opposition today took the Government to task for the Rs. 130-crore pay-order scam in the stock market and accused it of doing nothing, despite warnings, to prevent it from happening.

The Congress demanded a probe by a Joint Parliamentary Committee into the pay-order scam, with its chief spokesperson, Mr. S. Jaipal Reddy, saying the party had reasons to believe that the brokers had strong political connections, and only a JPC ``could unravel the broker, banker politician nexus''.

Describing it as a ``classic clone of the 1992 scam in style and scale,'' Mr. Reddy accused the Securities and Exchange Board of India of being a mute spectator while the scam was taking place. The SEBI had failed to act as a watchdog and there was no justification in the continuation of its chairman, Mr. Reddy said.

The Congress claimed it had warned the Government on March 3 about Mr. Ketan Parekh's activities and about the possibility of a major crisis for the economy. ``Shockingly, the Finance Ministry, the RBI and the SEBI did precious little even after our warning,'' said Mr. Reddy. Due to the studied neglect, the Bank of India paid Mr. Parekh Rs. 60 crores as late as March 8.

The party charged that the SEBI chairman had indulged in insider trading, and accused the Government of treating him with kid gloves. ``The SEBI chief was caught indulging in insider trading in the form of taped evidence yet he had not been arrested and other bear operators including FIIs, who indulged in insider trading, have also got away scot free,'' said Mr. Reddy. The CPI(M) politburo also equated the present scam to the one committed in 1992 and held the Finance Minister, Mr. Yashwant Sinha, directly responsible for it.

``He has a direct responsibility and much to answer,'' said a party statement. It accused Mr. Sinha of trying to promote his budget by boosting the stock market and ignoring ample evidence of ``crookedness in the market circles''.

It also charged the SEBI and the RBI with failing to put in place effective measures to check insider trading and rigging of share prices by a cartel of brokers.

The CPI also took the same line and accused the Finance Minister of doing nothing to arrest the problem. The Government had learnt nothing from the findings of the last JPC, it said.

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