NSEL: Police say board was aware of scam, EOW to attach investors' assets

Mumbai: The plot is thickening in the NSEL fiasco, and the noose is tightening for the former top brass of the NSEL. According to reports, Mumbai police believes that the NSEL board was in the know of all transactions at the debt ridden spot exchange.

Although investigations are still in the initial phase, according to CNBC-TV18 sources there was clear indication of mismanagement at the board level.

A CNBC-TV18 report notes that even during the board meeting while some of the board members were not present, they were marked as present, which clearly indicated that there was forging of the minutes of the board meeting. Investigations also suggest that they were in the loop of all clearing transactions.

[caption id=“attachment_1178367” align=“alignright” width=“380”]  Representational image. Reuters.[/caption]

The city police’s Economic Offences Wing has started identifying the immovable assets of those accused in the Rs 5,600-crore payment crisis at the National Spot Exchange Ltd (NSEL) in a bid to attach them.

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The EOW, which has arrested three people including former NSEL managing director and chief executive Anjani Sinha, had invoked the stringent Maharashtra Protection of Interest of Depositors (MPID) Act in this connection. “We are identifying the immovable properties of the accused so that we can attach them and submit a detailed report to the special MPID court, which has an authority to direct the department concerned to auction them and dole out the money to the victims,” said an officer.

The Mumbai city and suburban Mumbai collectors recently granted permission to invoke the Act, which gives the EOW power to attach the properties of all the accused. “We are shortlisting the accused’s assets…,” the officer said.

Some of the movable assets of those arrested have already been seized, the officer added.

“Arrested accused Anjani Sinha, the former head of the beleaguered bourse, is forthcoming and revealing as to what sort of dealings he had done while he was in the office,” the officer said.

He added the probe has indicated that the NSEL’s board was driven by a few men and it has clearly emerged that a lot of mismanagement took place in the bourse.

The officer categorically stated that no accused in the case would be turned approver as the investigators have sufficient electronic and documentary evidence against the accused.

The EOW arrested Sinha on October 17. Amit Mukherjee, an ex-assistant vice-president of NSEL, had been arrested on October 9 and the next day, police arrested Jay Bahukhundi, another ex-assistant vice-president who was in charge of the KYC department.

An FIR was registered in the case on September 30 by the EOW against the directors, including Jignesh Shah and Joseph Massey, promoters and defaulters.

All of them have been charged with cheating, forgery, breach of trust and criminal conspiracy and other offences under the Indian Penal Code. On October 1, the CBI registered a preliminary inquiry in the case.

The NSEL has been facing problems in settling Rs 5,600 crore of dues of 148 members/brokers, representing 13,000 investor-clients, after it suspended trade on July 31 on the government’s direction.

Meanwhile, the Bombay High Court today asked the Union Ministry of Consumer Affairs and commodities regulator Forward Markets Commission (FMC) to inform it if they had powers to regulate the scam-hit National Spot Exchange Ltd (NSEL), by Friday.

The direction was given by a bench headed by Justice S F Vajifdar while hearing petitions filed by a group of investors, including a petition filed by Investors’ Grievances Forum President Kirit Somaiya, urging a probe by CBI or any other agency into the Rs 5600-crore scam.

With inputs from Agencies