Venkat Chary notice to PwC on MCX audit

Chary is objecting to PwC mentioning his name as the key management personal of MCX

PricewaterhouseCoopers (PwC) has got a legal notice from Venkat Chary, former chairman of the Multi Commodity Exchange (MCX) on the special audit report it gave last year on the latter entity.

The report was given in April last year to the Forward Markets Commission (FMC), which had commissioned it in the wake of the payments scam at the spot exchange promoted by Financial Technologies (FTIL); the latter was also anchor investor in MCX. It was a critical report and had named Venkat Chary, now non-executive chairman of FIL, as one of the key management personnel of MCX.

Chary has told the audit company that he was an FMC-nominated non-executive independent director and chairman of the board of directors of MCX, till he resigned in the wake of the revised guidelines which laid down 70 years as the maximum age for a chairman or a director.

Chary has cited the Companies act on the definition of “key managerial personnel”, to argue he should not have been so described. His notice to PwC asks it to take immediate steps to rectify this error. Since the report was made public, “it has caused serious damage to my reputation”, his letter says.

He says if remedial action is not taken, he would ask for action on professional misconduct under the Chartered Accountants Act, 1949. And, “I also intend to resort to the civil and criminal courts for damages/action.”

When asked, a PwC spokesperson said, “Our work has been executed to the expected professional standards and we stand by the content of our report submitted to the Forward Markets Commission.”

FTIL had, when the report’s contents became known, said it had been prepared without giving them a chance to respond. Also, recently, Riddhi Siddhi Bullion had sent a legal notice, threatening damages, for mentioning its name as ‘indulging in wash trades on MCX’.