NSEL Saga -The making of a bollywood thriller

The NSEL saga has the making of a second grade Bollywood flick

In Mumbai’s lingo,the entire National Spot Exchange Limited (NSEL) saga is nothing short of ‘filmy’. The lead role will be played by a rag-to-riches owner of NSEL around which the plot revolves. The side characters are the brokers and their agents who lure in fat rich golf playing guys as investors in their get-rich-quick scheme.

 

A clueless police is played by the government and its controlling bodies who like in the films come in well after the crime has been committed and then ‘pretend’ to solve the case.

 

Enters Dr.Arvind Mayaram, Secretary of Department of Economic Affairs, whose panel submits a fact finding report to the finance minister and prime minister. As part of its information gathering process, Mayaram meets the victim – the investor’s body representing 13,000 investors. Rather than consoling them, Mayaram asks them coldly, ‘You are high net worth individual and well informed; Why did you trade on the NSEL? Our ‘poor’ investors come out crestfallen resorting to the clichéd mode of protest – sloganeering.

 

Mayaram while reprimanding investors forgets to pull up the government who have allowed the scam to progress despite the Forward Markets Commission (FMC)  raising the flag over a year back. Rather than catching hold of the casino owner, police is giving lessons of good behaviour to the players. Nothing wrong in Mayaram’s behaviour if one looks at the issue objectively.

 

Brokers offered NSEL’s product, which was essentially a financing scheme, to its top clients. An assured return of 14-18 per cent at a time when there were few safe investment avenues was lapped up by investors without doing proper due diligence. Though brokers might try to project themselves as innocent victims, it is very unlikely that they were not in the know. 

 

A customer normally complains to the shopkeeper for selling a packet of soap if there is no soap in it. It is the duty of the shopkeeper to check the product he sells. 

 

It is in Mayaram panel’s report that the movie turns from a B grade movie to a C grade one. Mayaram has recommended actions for reviving the exchange and set rules for a smooth running of spot exchanges. Who in the right mind would like to trade in an exchange that does not honour its commitments?

 

There is no talk of banning the ‘hero’ from running similar casinos. At best, the present exchange will be taken away from him.

Anyone who has ever visited Las Vegas or Macau knows that the gambling house never loses. In the end, the movie will have a happy ending for the hero. As for the fat rich guys, they would be better off working on their golf score rather than knocking on doors where a Rs 5,600 crore scam is considered too small and politically harmless.