The Securities and Exchange Board of India (SEBI) has been working hard to bring transparency and accountability in the securities field. Recently, SEBI declared that it would release corporate governance rules for the listed entities in India very soon. SEBI has also notified the Securities and Exchange Board of India (Procedure for Search and Seizure) Regulations, 2014 (PDF)
SEBI is deriving its powers regarding search and seizure from The Securities Laws (Amendment) Second Ordinance, 2013 (PDF) passed in September 2013. The Ordinance has conferring explicit powers on SEBI’s Chairman to authorise Investigating Authority or any other officer of SEBI to conduct search and seizure under the Securities and Exchange Board of India Act, 1992 (PDF) (SEBI Act).
These regulations provide detailed procedures to be followed for issuance of warrants and execution of search and seizure orders, among others. Besides, a necessary framework has been provided for the safeguards to be adopted during different stages of search and seizure and to protect the rights of those persons subjected to search and the obligations of the authorised persons.
In regard to the rights of the persons being searched, the norms state that the occupant of the place being searched can see the warrant and obtain a copy of it, can verify the identity of the authorised officer and officials assisting him, to be present during the search and seizure operation and to have copy of document(s) seized or take extracts therefrom. Such an occupant would also have rights to have a copy of any statement recorded during search and seizure and to put his own mark of identification on the document seized on recording the description of such mark of identification.
According to the new norms, the authorised personnel of SEBI could seize documents including drawings and paintings, videotapes and computerised material, among others. For searching computers, the norms lay out that an authorised officer could use any reasonable measures to access a computer system or other data storage device, which the person being searched has in physical possession.
With more and more work are now managed by computers and information and communication technology (ICT), India needs to strengthen its cyber forensics and cyber crimes investigation capabilities. For instance, the economic offences wing (EOW) of the Mumbai Police is investigating the Rs 425 Crore QNet Scam. The investigation would require sound techno legal expertise and possible use of e-discovery and cyber forensics methods. The search and seizure regulations of SEBI would further add the requirement to possess techno legal expertise on the part of investigation officers in India.