With special court Justice M.S. Rane sentencing Big Bull Harshad Mehta to five years' rigorous imprisonment in one of the several cases registered against him for his role in the securities scam, things appear to be finally coming together in the case which is so old - the scam first surfaced in 1992 - that you need to refer to the archives to remember the specific charges. When the news of the impending conviction first filtered out, for example, most stock market watchers were hard put to explain how Mehta had got control of Rs 39 crore of Maruti Udyog's funds - it was only when the final ruling came that one remembered that it was complicity and several instances of forgery by a Maruti employee as well as of some employees in banks like ANZ Grindlays and UCO Bank that allowed this to happen.If it has taken more than seven years to hand down just one conviction against a man who caused losses of thousands of crores to individual investors, surely something is grievously wrong with the country'sjustice machinery, especially when the case is being tried by a special court. And going by previous experience, it is far from certain as to what sentence Harshad Mehta will ultimately get, the special court's verdict notwithstanding. In any case, Mehta's lawyers have already announced that they will appeal to the Supreme Court. In another case involving scam accused Hiten Dalal, the special court suspended its sentence some months ago to allow him to appeal to the Supreme Court - it could take several years now for Dalal to be punished, assuming he loses the battle in the Supreme Court.Harshad Mehta and his cohorts will hopefully be convicted in all the cases against them, later if not sooner. But Mehta alone does not represent what is wrong with the markets. The reason why small investors, who burnt their fingers in Mehta's famous bull run, are not coming back is that similar malpractices continue in the country's top bourses even to this day. To cite perhaps the most recent example of how thecountry's bourses are still rigged, just last month the Bombay Stock Exchange restructured what is called the Group A category of shares. What were included were ten stocks, till then not very fancied ones. Since the rules for trading in Group A stocks are somewhat different than for others, this allowed speculators to hugely rig up prices of these stocks. It was only when a furore was raised, in part by this newspaper, that the market regulator SEBI asked the BSE to review their decision and these stocks were dropped from the list. SEBI obviously scored here, but there are enough instances of it being so slack it may as well not be there. Last year in June, for example, after top brokers were unable to meet their payment obligations, SEBI found that promoters of some top companies were in league with brokers to rig up the prices of their stocks. Six months have passed since the investigations were concluded, but SEBI is yet to take any action. If a hundred Pied Pipers are allowed to flourish for every onereined in, the odds still seem stacked against the small investor.
