Officials from three top brokerages held for NSEL scam

Three officials of top brokerages were on Tuesday  arrested by the Economic Offences Wing (EOW) of the Mumbai Police in connection with the sensational Rs 5,500-crore fraud at the National Spot Exchange Ltd (NSEL).

Several arrests were made last year, including that of NSEL promoter Jignesh Shah, but this is the first time top brokers have been arrested in the scam, market sources said.

Three top brokers - Anand Rathi Commodities Managing Director Amit Rathi, India InfoLine Commodities Vice President Chintan Modi and Kochi-based Geojit Comtrade’s whole time Director C P Krishnan – were called to the EOW office at the Crime Branch-CID headquarters at Crawford Market here and after questioning placed under arrest.

They would be produced before a Magistrate’s court on Wednesday. EOW officials confirmed the arrests. The investigations are being handled by Additional Commissioner of Police Rajvardhan Sinha, who heads the EOW.

“This is one of the biggest developments in the NSEL scam,” sources told Deccan Herald.
The NSEL scam had come to light after the government had on July 31, 2013, ordered the Jignesh Shah-promoted spot exchange to stop trading in some instruments which led to a payment crisis. Following this, the exchange was forced to suspend trading and shut operations, leaving over 11,000 investors in the lurch

After his arrest in May 2014 and bail in August, Shah, who founded Financial Technologies, stepped down from his position of Managing Director and Chief Executive in November.
NSEL commenced live trading on October 15, 2008. At present, NSEL is operational in 16 states across India, providing delivery-based spot trading in 52 commodities, according to the Exchange website.
DH News Service