The Economic Offence Wing (EOW) of the Mumbai police raided offices and residences of promoters, directors and defaulting brokers of the National Spot Exchange Ltd (NSEL) on Monday and booked them in connection with Rs 5,600-crore payment default crisis.
The police searched 184 locations across 16 states, including Mumbai residences of Jignesh Shah, chairman and managing director (MD), Financial Technologies (India) Ltd (FTIL), and Joseph Massey, MD and chief executive officer (CEO), MCX Stock Exchange.
According to the Mumbai crime branch, the first information report (FIR) lists the main accused as FTL-the holding company of NSEL-Board of directors Shah, Massey, sacked NSEL CEO Anjani Sinha, Shantilal Guru, B.D. Pawar, Shrikant Jawalgekar, R Devrajan, Amit Mukherjee, Jai Bahukhundi, M. C. Pandey, Santosh Mansingh, H. B. Mohanty, Shashidhar Kotian, Neerav Pandya, auditor Mukesh Shah and 25 borrowing companies/ trading members and some trading members/ brokers.
The raids were conducted to seize statements, book of accounts, and hard disks and other electronic evidence in the case. Sixty-three police teams visited 185 locations in the country.
Mumbai joint commissioner of police (crime) Himanshu Roy said, "We have booked the NSEL officials on the basis of a complaint lodged by one of the NSEL investors Pankaj Saraf."
Saraf, who had formed an investor forum to recover their money lost in NSEL, had lodged the complaint around a month ago.
The accused have been booked under various sections of the Indian Penal Code like 409 (criminal breach of trust), 467 (forgery), 468 (forgery for purpose of cheating), 471 (using as genuine a forged document), 474 (possession of forged document) and 120B (criminal conspiracy).
Roy said, "In a commodities exchange, commodities are supposed to be backed by physical good in warehouses, which was not being done here. Bogus warehouse receipts were being issued and trade was conducted only on paper."
NSEL issued a statement after the raids: "We understand that investors have filed several complaints... NSEL and Financial Technologies Group will fully cooperate with the government authorities in these investigations and is open to any scrutiny to bring the actual culprits to book."
Massey put up a brave face denying that any police raid had taken place at his residence.
In association with Mail Today