About Midas


The missionary vision of a committed individual, Virendra Jain marked the birth of Midas Touch Investors Association at Kanpur in the year 1996. Though not a professional, Jain’s past study and experience as a stock market analyst and columnist in 1980’s & 90’s gave him the insight to identify important issues concerning small investors and corporate governance. He methodically explored all options- administrative, legislative and judicial- available under our democratic framework. This enormous task entailed undertaking research, preparing representations, briefing the counsel and interacting with media etc. These were virtually done single handedly by him at his personal cost for years.

His pro-active role, through Midas, acted as a catalyst in acceptance of small investors as a valuable stake holder in the capital market and institutionalization of his voice at some of the important forums. This is a singular contribution by Midas on investor protection. Its participation & views are now sought and valued by Parliamentary Committees, Ministries, Regulators and Media. In a short span of about a decade, Midas has carved a name and recognition of a frontline- not for profit organization- in the country on its strength and merit of a dedicated, quality, yeoman’s service to the investor and capital market alike.

In 2004, recognizing the stature and the capabilities of Midas, it was entrusted with a special e-governance project, by Investor Education & Protection Fund under Ministry of Corporate Affairs, for assistance in redressal of investor grievances. Hitherto, individual investor grievance redressal was considered as an area where even angels feared to tread. Its subsequent laudable results vindicated the Governments’ faith in the organisation.

In the small investor’s battle for a level playing field and justice, Midas has always been in the forefront through advocacy, participative and judicial process.


It is Midas endeavor to influence changes- in policy planning, laws and its administration- to protect investor’s interest and evolution of a fair securities market in the country. Towards this end, important issues are raised in different forums and representations are made to concerned authorities. Over the years, its contribution has been phenomenal in this sphere. 


Midas has conceived, created and manages Investor Helpline- A free of charge, novel e- governance project, assisting investors in redressal of their grievances.


Midas, and its founder, has been nominated on various committees appointed by the Government and is invited as a speaker on important forums.

Judicial Intervention 

As an active investor protection group, Midas took up matters concerning the small investors with appropriate authorities, followed them up diligently and when the impasse continued, filed PILs in Hon’ble Allahabad High Court. All the PILs filed by Midas were admitted by the High Court. The issues related to:
  • IPOs based on misleading disclosures including sanctioning of loans by Banks & FIs on inflated projections.
  • Vanishing Companies- encompassing intermediaries in the Primary Market & no monitoring of companies post IPO Listing.
  • Mutual fund scheme sponsored by a Nationalized Bank reneging on its promises to unitholders- Canstar Mutual Fund.
  • On NPAs and gaps in banking regulations for recovery.
  • Fundamental shortcomings in the composition of Stock Exchanges Board of Directors.
  • Duping of investors through manipulation in its share prices & non payment of deposits by promoters.

Though unknown, companies used to disappear after raising money through public issues of shares. Post liberalization, such white collar crimes were committed on a large scale, duping lakhs of investors and eroding his confidence in the capital market & its entire system. Considering the grave systemic implications of such a scam, Midas got it raised in Lok Saaha in 1996, wrote to PM in 1997 and ultimately filed a PIL in 1998. At this time, this was considered as a preposterous allegation as listed companies were thought to be tightly regulated - prior to & post public issue- unlike Chit fund companies or NBFCs. The IPO process entailed numerous intermediaries e.g. Merchant Bankers, Underwriters, Bankers to the Issue, Appraising agencies & Chartered Accountants and Stock Exchanges as the first line regulator post IPO.

A pandora’s box opened when both, SEBI & DCA, disowned any statutory responsibility to monitor companies after IPO. This vindicated Midas contention that no authority is regulating companies after IPOs. In the ensuing controversy, the matter was referred to the Prime Minister who issued orders to Ministry of Finance for action within 3 months against the unscrupulous promoters.

In 1999, Hon’ble Allahabad High Court, approved the action plan submitted by the Central Government and ordered the constitution of Joint Central Coordination & Monitoring Committee (CMC), co chaired by the Secretary, DCA & Chairman, SEBI to be assisted by seven task forces for identification of delinquent companies and initiating action against them & their promoters / directors under the respective statues and Indian Penal Code.

Till 2001, CMC had identified 229 Vanishing Companies. Out of which 116 were deleted later on. Further 09 more companies, which came out with IPOs during 1998-2001 were included in the list.

Prosecutions & FIRs have been filed against most of these companies and their promoters and directors. Prosecution under the Companies Act was launched against some of the auditors.

Wide ranging changes in Securities laws were enacted. It triggered formation of Serious Fraud Investigation Office. (SFIO)

In 2004 a committee for monitoring cases of prosecutions and FIRs was formed, which includes senior officials of ten State Governments and Commissioner of Police.

The staggering sweep of the issue is evident by the concerns expressed by the JPC, raising of the issue in the Indian Parliament for last 10 years & a must topic in International Forums (including World Bank) discussing securities market in India.


In 1997, Midas Touch Investors Association filed a PIL in the Allahabad High Court resulting in a staggering payment of Rs. 974,00,00,000 to over two lakh investors by Canara Bank. This was Rs.475 crore more than what it had proposed in their failed revised proposal. The Central government-100% owners of the bank- gave Rs.600 crore to Canara Bank to facilitate this payment. This was a watershed in protection of investor rights in the country.

In 1990, Canbank Mutual Fund-promoted and managed by Canara bank-had raised Rs.800 crore from investors and assured a repayment of four times of the principal amount after ten years in its “Canstar” scheme. The investors had an option to get pre-determined assured repayment, anytime during the tenure with unlimited repurchase facility. Mid-way, in 1996, Canbank unilaterally stopped redemption and wanted to change the basis of redemption, from assured amount to NAV basis, which would have entailed a much lesser repayment.

This development lead to demise of "assured returns" scheme offered by mutual funds and a complete revamp of regulatory framework for mutual funds offering "assured returns". Under the reformed guidelines, adequate preventive and redressal mechanism was laid down and the onus of repayment shifted entirely on the mutual funds. This strengthened the integrity of the market and investor protection.

Satyam accounting fraud resulted in losses of thousands of crores to its shareholders. Absence of any provision for awarding compensation to the duped investors- in the SEBI Act and the Companies Act- highlighted the glaring weaknesses in the Laws for investor protection and inadequate provisions for confiscation / disgorgement of illegal gains was another.

Midas, in a path breaking endeavor, filed a petition on behalf of 3 lakh individual investors, under the Consumer Protection Act seeking Rs. 4987 crore damages from Satyam, Raju brothers, its statutory auditors, Price Waterhouse and independent directors. Such a petition, modeled on Class Action Suits prevalent in U.S., was filed for the first time in India.

Midas Petition before the National Commission and its appeal before Hon’ble Supreme Court were dismissed leaving the investors in a lurch.

Joint Parliamentary Committee (JPC)

Midas was one amongst the privileged 8 unconnected individuals / associations invited by Joint Parliamentary Committee (JPC), during the investigation proceedings, for personal deposition before it. The JPC in its report to the Parliament in 2002 quoted some parts of the deposition made by Midas. It recommended numerous suggestions made by Midas for enhancing investor protection.

The JPC was set up on 26 April 2001 by Parliament to probe the March 2001 Securities Market scam. The committee was chaired by Shri Prakash Mani Tripathi and consisted of 30 members – 20 from the Lok Sabha and 10 from Rajya Sabha.

The terms of reference of JPC included probing into the scam & suggesting safeguards and improvements in system to prevent the recurrence of such failures and protect small investors.

A brief summary of the recommendations of JPC on suggestions made by Midas Touch Investors Association are:-

  • To give representation to investors on Board of Directors of listed companies, SEBI and on various Advisory Committees.

  • SEBI, DCA, CLB and RBI should take necessary steps, including attachment of properties of the directors of the vanishing companies, so that the investor get back their money from vanishing companies.

  • SEBI should evolve suitable criteria to check highly manipulative prices in IPOs.

  • SEBI must stop Public Issues for dubious or fraudulent promoters.

  • SEBI must take the responsibility of monitoring End Use of funds raised through public issues in order to prevent diversion of funds of the company by the manipulative promoters. The management of the defaulting companies be suitably punished.

  • Mandatory disclosure of promoters of their intention to increase or decrease their shareholding.

  • Managing Director/CEO along with one director of the listed companies be made responsible and accountable for true and correct disclosures and in case found false, they must attract criminal liability.

  • To make manipulation of shares a cognizable offence.

  • Consumer Court or Security Tribunal should be empowered to award compensation to aggrieved investors.

  • Distribution of impounded funds amongst the affected investors.

  • Rules governing preferential allotment of shares be framed to prevent its misuse by promoters and permit the same for legitimate purposes.

  • To define “undesirable activities” in Acts.

  • Suitable funding to Investor Associations.

  • To form a Committee consisting of representatives of SEBI, DCA, RBI(NBFC & Banking division), Stock Exchange and Investors Association to develop an effective grievance redressal system.

Co-ordination & Monitoring Committee (CMC)- Vanishing Companies

Midas has been invited by the Committee thrice, for personal appearance before it to suggest measures for identification, prevention and redressal. The CMC was constituted in 1999 after Midas PIL on Vanishing Companies in Hon’ble Allahabad High Court. Since then, CMC has met more than 20 times. In April 2007, Midas gave a detailed presentation on a mechanism which would generate early warning signals of a potential vanishing company. In its presentation, Midas reiterated its suggestion for disgorgement of assets and their distribution amongst the affected investors. The small group constituted by CMC has recommended inclusion of many of the suggestions made by Midas in this regard.

Justice Wadhwa Committee

Virendra Jain, our main founder, was nominated by SEBI on a high powered committee set up by it under the Chairmanship of Justice D.P. Wadhwa, former judge of Supreme Court of India. The terms of reference of the Committee included: To advise / recommend on the procedure of identification of persons who might have been deprived on the account of Initial Public Offering (IPO) irregularities- thousands of multiple applications made by applicants- and the manner in which reallocation of shares to such persons should take place.

The Committee has recommended disgorgement and distribution of Rs. 92 Crores to the 25 Lakh applicants. If implemented, this would be the first case of disgorgement and compensation to the cheated investors, in India.

Representations to various authorities and regulators are made, from time to time, by Midas Touch, on important issues relating to corporate governance, protection of investors interest and systemic reforms. Some of the representations made over the years, are as follows:-

Securities and Exchange Board of India (SEBI)

  • Request to Chairman SEBI for complete investigation and action against all those who were involved in manipulation of “ Yes Bank” IPO & Public Issues during last two years, disgorgement and removal of systematic deficiencies. (2005 )
    Impact: Investigation in IPOs made during 2003-2005 carried out by SEBI and various orders issued. (2006-2007)

    A High Powered Committee has been set up by SEBI under the Chairmanship of Justice D. P. Wadhwa, former Judge of Supreme Court of India, vide notification dated July 5, 2007. Virendra Jain is one of the other four members of this committee. The terms of reference of the committee includes: To advise / recommend on the procedure of identification of persons who might have been deprived on the account of Initial Public Offering (IPO) irregularities and the manner in which reallocation of shares to such persons should take place.

  • Representation regarding misuse of discretionary allotment to QIBs in IPOs and requests to amend DIP Guidelines so as to create a level playing field, amongst all applicants in IPOs. (2005 )
    Impact: Discretion to issuer companies/lead managers in allotment to QIBs withdrawn and guidelines framed. Some of the requests acceded to by SEBI. (2005-2006)

  • Submission of suggestions and comments, to SEBI, on changes proposed in SEBI (DIP) Guidelines. (2004 )

  • Representation requesting effective steps to protect small investors interest in Z group Companies listed on BSE.

  • Request for investigating alleged insider trading in US-64 scheme (2002)
    Impact: Joint Parliamentary Committee (JPC) constituted to investigate entire gamut of UTI’s US-64 scheme. (2002)

  • Demand for withdrawal of draft prospectus for biggest ever IPO amounting to Rs. 13,000 crores as it contained misleading and inadequate disclosures. (2005)
    Impact: Clearance of IPO was withheld by SEBI and later on the company withdrew its proposed offer document. (2006)

  • Representation on misleading disclosures made by real estate companies by manipulating their land bank particulars. (2007)
    Impact :The Board of SEBI approved introduction of norms to be complied with by real estate companies in offer documents. (2007)

  • Made a strong demand for mandatory grading of IPOs. (2006)
    Impact: SEBI made grading of IPOs mandatory in 2007.

  • Comments and suggestions to SEBI regarding the “Regulations” proposed for “Delisting of Securities”.
    Impact: Pro-Investors delisting regulations framed by SEBI in 2009.

  • Drawing attention to shortcomings and misleading disclosures in dozens of draft prospectus submitted to SEBI for proposed public issue. (1996 to 1998)

  • Demand to scrap entry load and marketing expenses levied on investors by mutual funds. (2007)
    Impact: Part of demand has been accepted by SEBI. (2007)

  • Demanding drastic reduction in charges levied on investors by Depository Participants (DP) as introduction of paperless trading has reduced the cost of the companies drastically. Logically, the companies should bear this burden and it should not be passed on to the investors. (2006)
    Impact: Part of demand has been accepted by SEBI. (2006)

  • Representation protesting unilateral and illegal suspension of repurchase for 6 months by UTI in US-64 (2001).

Coordination and Monitoring Committee (CMC)

  • List of probable/potential vanishing companies were submitted for examination and action, to CMC in 1999 and 2003.

  • A comprehensive database of 229 companies identified as vanishing by CMC was submitted after collation. This included name of directors and promoters, directorships held in other companies, merchant banker, chartered accountants with complete addresses, particulars of financial participations by banks and FIs, other IPO details etc.

  • Important issues arising out of the action taken by CMC were raised, from time to time.
    Impact: CMC invited Midas Touch Investors Association to make a presentation before it to suggest an early warning signal mechanism within the existing legal framework in order to prevent such occurrences in future. In 2007, Jain made a detailed and comprehensive presentation before the CMC.

Company Law Board

  • An application to CLB for prevention of oppression of small share holders and mismanagement by DSQ Software Management and investigations and action under Companies Act, 1956. (2002)
    Impact: Wide ranging action was initiated against the management of the company.

Department of Company Affairs

  • Request to Secretary DCA to activate Investors Education and Protection Fund (IEPF) expeditiously and register investor associations with it. (2002)
    Impact: The IEPF was activated shortly thereafter.

  • Advocated strongly for empowering small investors by giving them representation on the Board of Directors of Listed companies to be elected amongst themselves. (2000)
    Impact: The companies act was amended in 2000 and vide section 252 the small share holders may have a Director elected by them in public companies.

Ministry of Finance

  • Request to Finance Minister for direction to UTI and FIs to exercise their rights- as substantial shareholders in L&T- as the price offered by Grasim to shareholders of L&T in their takeover bid was low. UTI and FIs should discharge the fiduciary obligation towards their investors. (1 November 2002).
    Impact: Ultimately Grasim paid a few hundred crores more in their final bid.(2003)

  • Submission of a note to Finance Minister outlining serious reservations on the recommendations made to Sebi by Justice Bhagwati Committee on "Substantial Acquisition of Shares & Takeovers" Regulations : (2002)

  • Finance Minister regarding cheating of investors in Public Issues by giving wrong and inflated profitability projections and misleading disclosures in the prospectus AND seeking intervention on specific instances given where term loans of hundreds of crore were financed by financial institutions and scheduled banks on fudged appraisal.(1996 & 1997)

  • Comments on the “Delisting Rules” proposed by Ministry of Finance.

  • Request for compilation of a database of companies under liquidation-currently not available in public domain- regarding status of the claims lodged and lodging of fresh claims by the investors. (2002)

Prime Minister

  • Request to order a CBI probe into the companies that vanished after garnering money from the investors through a public issue. Jain wrote that it pointed towards a complete failure of the regulatory/ statutory bodies to either prevent, detect or trace such companies. It highlights, not a breakdown of the system, but an alarming absence of one.(1997)

Website: www.mtia.in