Column: Why is Sebi finding it difficult to track Sahara investors?

Arun Kejriwal
The imbroglio involving the Securities and Exchange Board of India (Sebi) and Subrata Roy-led Sahara Group is not a simple case of money being taken and not returned to investors; neither is it a shady deal like the Saradha scam.
The Reserve Bank of India (RBI) had overseen the refund of over Rs 22,000 crore to about 40 million Sahara investors by a handpicked committee a few years ago. Neither the committee faced the problem of identifying investors nor it doubted their existence.
Certainly, the apex bank has greater knowledge of investors, and a refund of this amount of money to such a large base of investors was a mammoth task. When RBI could do it, why is Sebi finding issues with the same set of investors as claimed by Sahara.
One must understand that the turf over which Sahara operates is with people who are unbankable. Returns offered by Sahara are in sync with the prevailing market rates and are not, therefore, unsustainable or in any way leading to instability.
The Sahara scheme is not a pyramid scheme and does not offer returns which can only be shown on paper. The rates vary in the range of 8-10 per cent, which is the current bank rate in the country.
Sebi in its wisdom says that since majority of the 20,000-odd people to whom it sent mails about their deposits did not respond, they are bogus or non-existent. The kind of questionnaire sent by the market regulator is beyond the realm of a well-read person and needs a high degree of expertise to be filled in and returned.
Secondly, when a person is asked to contact the Sebi headquarters in Mumbai for a refund of Rs 8,000, he/she feels it is not worth it. Thirdly, if the investor has already been refunded by Sahara, why should he claim a bogus or double refund? The most interesting aspect of the episode is that the same 20,000-odd investors from whom Sebi did not receive reply, Sahara got KYC and refund discharge vouchers in the standard prescribed and accepted form from over 16,000 people.
RBI refunded about Rs 22,000 crore is not acceptable to Sebi. The regulator is not willing to work with Sahara.
Sebi is not able to locate investors and yet it wants more money. Why and for what is something that Sebi needs to answer? In the Saradha case, which rocked West Bengal last year, thousands of investors came out to protest and there were a few cases of suicides as well.
Why do not we see similar protests in the Sahara case if there are millions of unpaid investors as claimed by Sebi? I believe in the current situation it makes sense for Sebi to seek help of bodies concerned in reaching out to the investors and seeing that the money due is refunded at the earliest.
The Supreme Court has also said that if Sahara's help is taken in doing so, there is no reason why the investors cannot be found and their rightful money be repaid. Like I said in the beginning, the case of Sebi versus Sahara is not one of investor protection but something which goes beyond that.