Lapses have taken place but we will honour commitments, says NSEL

Mumbai: National Spot Exchange Ltd (NSEL) today assured its investors that it will honour all commitments.

NSEL, promoted by Jignesh Shah-led Financial Technologies (India) Ltd, is facing the problem of settling dues worth Rs 5,500 crore to 148 members/brokers representing 13,000 investor clients, after it suspended trade on July 31 on government’s direction.

“There have been lapses at NSEL but we will fix those. We will honour all our commitments,” NSEL Director Jignesh Shah told reporters here today.

NSEL Investors Forum members today protested outside Shah’s office in Mumbai, demanding an end to payment crisis and merger of NSEL with Financial Technologies Ltd.

[caption id=“attachment_1067661” align=“alignleft” width=“380”] Investors protest against payment default crisis of Jignesh Shah, CEO of Financial Technologies, in Mumbai. PTI[/caption]

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Refuting the allegations of unethical practises, Shah said he is willing to face any probe. “Neither me nor Financial Technologies has done anything unethical or improper…. and I personally and the company is ready to undergo any scrutiny or anything which is required to be done,” Shah said.

He said the board of NSEL has constituted a crisis management team and the exchange is extending “full cooperation” to the forensic auditor.

Grant Thornton, appointed as the forensic auditors, commenced the audit on Tuesday, in addition to the internal investigation already initiated against the management team.

The first target of the exchange is to recover the money from the defaulting members, NSEL officer on special duty P R Ramesh said.

“Our first target is to recover the money from defaulting members. Some of the database that will come out will show that many of the defaulting members are backed by big clients or big processors. With the forensic audit and help of all the agencies, we will take steps to recover the money from the defaulters,” Ramesh said.

After declaring nine members as defaulters on Monday, NSEL declared another 10 members as defaulters today: LOIL Continental Food, LOIL Health Foods, Mohan India Private Ltd, Namdhari Food International, Namdhari Rice and General Mills, White Water Foods Private Ltd, Shree Radhey Trading Company, P D Agroprocessors Private Ltd, Swastik Overseas Corporation and Juggernaut Projects Ltd.

“As per the rules and bye-laws, the Exchange has asked defaulting members to submit their books of accounts and hand-over all the collaterals to the Exchange,” NSEL said in a statement.

PTI