This year it is home trade. Last year it was Ketan Parekh and UTI. The names change; the season-the summer months between March and June-and the locale, Dalal Street and Mint Street (the Reserve Bank of India is located there) remain the same. Recurrent financial scams have become part of the very fabric of the Street engendered in part by an inadequate regulatory regime, and the other part by greed. All seven scams that have rocked the Indian financial markets in the past decade have come to pass between March and June. Coincidence? Not quite. The last days of March and June are preferred dates to close the books in India. This is when accounts are closed and books balanced. It is also the time when companies track and 'call back' all their money that is out there. That breaks any chain financed by such money, brings instances of system abuse to light, and unearths scams. There just ain't no cure for them summer time blues.

-Roshni Jayakar

April 1992
L'affaire Harshad Mehta

The original big bull, his Toyota Lexus became the symbol of the kind of rags-to-riches story everyone likes to hear. Mehta was a proponent of the replacement cost theory. ''What would it cost to set up a company with the capacity and reach of acc?'' he asked in the early 1990s. By February 1992, he had asked this question often enough, and the acc scrip zoomed from Rs 500 to Rs 10,000. Mehta was also siphoning funds using Banker's Receipts, and using this money to ramp up prices of the shares he was interested in. The scam came to light in April 1992, caused ripples in Parliament, and was estimated to be of the magnitude of Rs 3,000 crore. Mehta himself owed the banks some 1,600 crore, faced income tax claims in excess of Rs 10,000 crore, and had as many as 72 suits slapped against him. The judicial process surrounding the scam dragged on till his death in December 2001. In the intervening nine-and-half years, he had spent a total of 107 days in custody.

April 1995
Who Is Pavan Sachdeva?

Sachdeva, the promoter ms shoes, went on to create noise that was disproportionate to his company's size, Rs 100-odd crore. A clutch of ads-created by Rediffusion-centred around the man and claimed MS Shoes' diversification into yarn and fabrics was backed by a buy-back guarantee from Marubeni Corporation. The barrage of ads preceded the Rs 428-crore issue of fully convertible debentures by the company; a Rs 271.51-crore rights issue was to follow. The scam broke when Sachdeva was arrested by the Central Bureau of Investigation over allegations that he colluded with officials in Securities and Exchange Board of India and SBI Capital to divert funds from the public issue to subscribe to the rights entitlement of the promoters. Nothing much came of the case, Sachdeva was acquitted, and his company went nowhere.

May 1997
The Queer Case Of Chain Roop Bhansali

The demise of Bhansali's Rs 1,000-crore financial services conglomerate-he'd even managed to acquire a banking licence-began when a State Bank of India employee discovered that the interest warrants issued by CRB Capital Markets weren't backed by cash. The bubble burst and over 1 lakh depositors, lured by the promise of high returns on their deposits, were left in the lurch. Bhansali was arrested and released on bail and is probably out there somewhere right now.

June 1998
The Payments Crisis

Aka as the return of the big bull, this mini-scam concerned the alleged collusion of Mehta with the promoters of three companies BPL Ltd, Videocon International, and Sterlite Industries to rig their share prices. That was the spark, many reckon, that set off the payments crisis of 1998. In April 2001, Securities and Exchange Board of India finally passed its ruling, banning the three companies from tapping the market for four, three, and two years respectively. It also barred Mehta for life from dealing in securities. In October 2001, the regulator's order against Sterlite was set aside by the Securities Appellate Tribunal.

March 2001
All About KP

Another bull, Ketan Parekh funnelled bank funds-obtained through pay orders-and money from some companies to ramp up the prices of his favourite scrips, known on the street as K-10 stocks. KP was arrested but later released on bail. However, in May 2002, the scam acquired a new lease of life when he was arrested again, this time over swindling European Investment Company of Rs 71.9 crore. The Joint Parliamentary Committee appointed to investigate the scam has held 50 meetings, but its report is still awaited.

May-June 2001
Un Trustworthy Institution

This was a scam waiting to happen: for 18 months, reports go, UTI Chairman P.S. Subramanyam mirrored KP's actions. Not content with that, he even picked 1.75 lakh shares at Rs 930 a piece in Arvind John's now-infamous Cyberspace Infosys. When the market crashed post KP, the net asset value of UTI's holy cow and the country's largest mutual fund scheme, US-64 plummeted. The Trust had to eventually place a freeze on transactions before a government-orchestrated rescue plan pulled it out of danger. Subramanyam was arrested and is out on bail. Meanwhile, UTI lurches from one low-point to another, the most recent being its decision to redeem a fixed-return scheme with funds from its own reserves.

April 2002
Hometrade Means More

Another summer, another scam. This time, the action surrounded government securities, alternatively known as gilts or G-secs. At one level, the heist was straightforward: co-operative banks (they were involved in the Harshad, CRB, and KP scams too) paid for G-secs they never received. The alleged perpetrators of the Rs 450 crore swindle, Home Trade CEO Sanjay Agarwal and a broker Ketan Sheth of Giltedge are in prison as investigations continue (Also see cover story of this issue).

After KRN, NRN
A country definitely isn't a company but Infosys' Narayana Murthy will still make a great President.

Two things that make Narayana Murthy an ideal candidate for President are his honesty and huge brand value

Infosys, or its employees, didn't have a part in the online narayanamurthyforpresident.org, but the feeling within one part of Bangalore's twin-it showpieces-the other is Azim Premji's Wipro-has always veered towards a greater more-than-just-Infosys role for Nagavara Ramarao Narayana Murthy. As one senior exec candidly remarked after the anointment of Nandan Nilekani as CEO, ''We've given Murthy to the nation.''

The 53-year-old whose card now reads Chief Mentor would be ideal as India's head of state. The President, after all, is nothing more than a mentor, his duties largely ceremonial without being altogether irrelevant to the running of the nation. As for his ideology, it is the right mix of self-help, socialism, and benign (and dilute) autocracy that is just the thing the country needs today.

When, in the early nineties, the Bangalore government dragged its feet over improving the road leading up to electronic city on the outskirts of the city, Murthy and a few other it-company heads rolled up their sleeves and got down to the task themselves.

The staff that maintains Infosys' sprawling campus is drawn almost exclusively from the local community. Murthy has often articulated his paranoia of anarchy-unless the country, and its companies, work towards a more equitable sharing of wealth. A few years ago, just before Infosys officially unveiled its new campus, an Infosys manager (not the same one who spoke of Murthy and the nation) showed me around making sure that I didn't miss the people, mostly women, who were watering the lawns, cleaning the corridors, or making themselves useful in some other way. ''Predominantly women,'' he stressed. ''The women of these households are the decision-makers; and they come from the immediate neighbourhood.'' In the not-so-prosperous boroughs surrounding Infosys then, the landscaped glass-and-chrome marvel that is the company's campus isn't envied, but respected. Maintenance staff is the only employee-category eligible for subsidised meals at the company's various food courts. The software pros pay market rates.

As for the benign autocracy bit, every visionary-founder is, and has to be, a part-time dictator-more so someone who has convinced a group of seven founders that it has a common vision. Scratch the surface of a successful start-up-almost 20 years after its founding, Infosys is a wildly successful one-and you are sure to find a benign dictator, someone who inspires I'll-die-for-you loyalty among his peers and subordinates, someone whose rendering of the big idea is alluring enough to convince everyone that there is only one way to do things, someone whose obsession with values and growth (not necessarily in that order) is matched only by his near-paternal concern for the well being of 'his people'. That's another reason behind the failure of some dotcoms. In their early years they were too democratic for their own good, or for the good of their business. Democracies and oligarchies don't work in start-up phase. That, though, is grist for another essay, not this one.

There are two more things that make NRN an ideal candidate for President. One, he is honest and doesn't mind the world knowing about it. And two, he'll make a great brand ambassador for India. Imagine as the country's President a man who has built a Rs 2,670-crore organisation; someone who can speak the language of business with potential investors; and, at the same time, someone who can relate to the language of politics. The last is part of the fabric of every organisation, and while little is known of the behind-the-scenes activity of Infosys, it does seem highly unlikely that an organisation founded by seven people, would have escaped its influence. Murthy has skillfully steered the company through that minefield, and let go at the right time. That's yet another reason to take this seemingly light-hearted presidential campaign seriously.

-R. Sukumar