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An individual claiming to be a former NSE employee today took to social media to level allegations against the exchange on the co-location issue and urged regulator Sebi not to allow settlement of the case. While the NSE did not reply to repeated queries in this regard, it could not be independently ascertained whether the individual was indeed a former employee. Sebi has intensified its probe into alleged lapses in high-frequency trading offered through the exchange's co- location facility. The NSE on its part is looking to settle the ongoing probe with the regulator under consent mechanism. Consent mechanism allows settling pending proceedings without admission or denial of any wrongdoing in certain cases. This case relates to some brokers allegedly getting preferential access through co-location facility, early login and dark fiber, which can allow a trader a split-second faster access to data feed and servers of an exchange. Even a split-second faster access is considered to result in huge gains for a trader. Earlier this month, NSE Chairman Ashok Chawla also said the exchange is in the process of "settling fully and finally" with Sebi some legacy issues. NSE's vice-chairman Ravi Narain, who was with the exchange since its inception, recently quit the board.
The probe also assumes significance in the wake of NSE's long- pending IPO awaiting regulatory clearance. The individual made the allegations through a four-page letter posted on micro-blogging site Twitter today in a series of tweets, wherein he also attached a purported forensic audit report on the case and tagged a number of journalists and media houses. He also threatened to make more 'revelations' about the matter. As per his Twitter profile, he joined the social media platform last month itself and had tweeted just once before today.
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)