With an aim to deploy latest technology and know-how to tackle ever-changing nature of threats to investor interest, capital markets regulator Sebi (Securities and Exchange Board of India) is looking to overhaul its market surveillance and network monitoring systems.
In this regard, Sebi has begun a process to rope an IT service provider for monitoring of its IMSS (Integrated Market Surveillance System) network through a network monitoring centre that would operate on a 24/7 basis.
The IT service provider would be contracted by Sebi for a period of three years, which can be later extended for six years, a senior official said.
Sebi undertakes its market surveillance functions through IMSS, which went live in 2007 and collects data for suspicious market activities through multiple sources, including its network systems at stock exchanges and depositories.
The IT service provider would need to monitor this network on a daily basis and would be required to have a highly competent security monitoring operations centre, which would operate on a 24/7 basis.
This security monitoring operations centre would be used for remote monitoring of security and surveillance infrastructure of IMSS, provide periodic security status reports to Sebi and real-time status reports through an online facility, and propose changes in light of latest security best practices and latest security threats.
Sebi would consider only those companies for the job that have been in the business for at least ten years, have had a minimum networth of Rs 100 crore in last three years and a workforce of 25,000 personnel or more. The service provider would need to deploy its qualified resident engineers at Sebi's IMSS data centres, as also for managing various other network systems.
The move is aimed at helping Sebi in its efforts towards a stronger continuous monitoring of manipulation attempts in the stock market and analysis of daily transaction data.
The IMSS system has also proved very useful in situations of high volatility, and the times when the attention is mostly focussed on major market-moving developments.
The market manipulators tend to be more active in these situations, thinking that the oversight machinery would be mostly focussed on monitoring issues like risk-management systems and proper settlement of payment obligations.
However, the IMSS keeps working on an auto-pilot like basis and an upgraded system would further help in the surveillance activities of the regulator.
The system collects transaction and master data from stock exchanges and depositories on a daily basis to generate alerts for predefined market manipulation scenarios.
It also provides data analysis and benchmarking tools, which are used in various policy decisions of the Sebi.
READ MORE ON Sebi, market surveillance, network monitoring systems, Integrated Market Surveillance System
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