CARE Ratings becomes the second credit ratings company after Icra to take action on an anonymous complaint against the company made to the Securities and Exchange Board of India (SEBI).
The company has sent its managing director and chief executive Rajesh Mokashi on leave, pending examination of the anonymous complaint made to SEBI. Till then, one of Mokashi’s deputies, executive director Arun Kumar has been asked to officiate as the “interim CEO”. Arun Kumar has been handling ratings but will stay away from the function to ensure it is done independently.
This was informed to the stock exchange filing by the company quoting the decision made by the board of directors of CARE Ratings.
The decision is similar to the earlier instance of Naresh Takkar, the managing director and chief executive of Icra Ltd being sent on leave, following an anonymous complaint.
It is not known if the anonymous complaint speaks of any wrongdoing by Rajesh Mokashi. In the case of Icra, however, the complaint to SEBI had mentioned that the management personnel at the helm of affairs of the rating agency had been involved in giving a high AAA rating to ILF&S last year, which went through massive turmoil failing on debt payments etc. before the government intervened. That situation had affected the overall financial services market itself.
Both the rating agencies are now in the process of conducting internal enquiries.