FT, Shah get two more weeks to reply to FMC notice

FMC asks why FT officials should continue to remain fit and proper person to run MCX

The Forward Markets Commission (FMC) has given two additional weeks to Financial Technologies, its promoter Jignesh Shah and others to reply to its show-cause notice.

On October 4, FMC had issued a show-cause notice, asking them why they should still be considered 'fit and proper' entities to run Multi Commodity Exchange of India (MCX). At that time, it had said the notice had to be replied to within two weeks.

Following the payment crisis at National Spot Exchange Ltd (NSEL), FMC had, on August 20, cautioned the board its fit and proper status was at risk.

However, notices were issued only to Financial Technologies, the promoter of the crisis-ridden NSEL; Jignesh Shah and the director on the spot exchange's board, along with former MCX managing director Shreekant Javalgekar and former MCX-SX managing director and chief executive Joseph Massey.

The show-cause notice was sent to all of them, as they were promoters or directors on MCX, which was regulated by the FMC. It had pointed to several aspects—why a related entity was allowed to trade on MCX, why proper due diligence wasn't carried out while selecting borrowers on NSEL, etc.