The trend of media companies selling editorial space or news for a price is part of this problem, since these reports mislead investors. Besides this, there is invariably a spate of speculative reports about future plans, attributed to anonymous industry sources, that get passed off as false media reports, but usually emanate from IPO issuers. Today, Sebi is forced to clutch at peripheral regulations even to question companies about such manipulative actions. Hopefully, the quiet period rules will allow it to probe deeper and question the media that colludes.
As with all other rules and statutes in India, empowerment does not necessarily translate to action and better investor protection. Sebi itself, under another dispensation, has controversially exonerated a powerful company on charges of insider trading and price manipulation, despite adequate powers to initiate action. Ironically, it was a Sebi board committee that decided the issue. Cases have also been lost through deliberate mishandling and delays. Such problems are part of all government organisations, but it is still crucial for the regulator to be empowered to check corporate mischief when they are dipping into investors pockets.