NSEL Director Shah quizzed again; focus now on broking firms

Jignesh Shah, promoter of scam-hit National Spot Exchange Ltd (NSEL), was today grilled by police for several hours even as the ongoing probe showed some broking firms and their directors had linked up with the bourse and indulged in unfair practice for monetary gains.
NSEL, where Shah is one of the Directors, is at the centre of a Rs 5,600-crore payment crisis which came to light in July last. Mumbai Police's Economic Offences Wing (EOW) is probing the scam. Shah had been questioned earlier also.
"We had summoned Shah again and he appeared before us for questioning today. We sought certain clarifications on new facts which emerged during our probe," said Rajvardhan Sinha, Additional Commissioner of Police (EOW).

Meanwhile, EOW is preparing to summon commodity broking firms and their directors, who had dealt with NSEL and carried out transactions on behalf of their clients, for questioning in connection with the case.
"Certain directors of broking firms had carried out a large volume trading for their own benefits. They indulged in what is called 'trade modification' which is not a correct practice," said another EOW official.
The broking firms had not provided information sought by investigators for the purpose of probe, he said. "The broking firms had claimed they did not have the information sought by us. We had to get the details from mirror image of the NSEL's server," the official said requesting anonymity.

On Monday, police filed a 9,100-page chargesheet in a court here against the five arrested accused, including the spot exchange's former CEO Anjani Sinha.

Four others named in the chargesheet are Amit Mukherjee and Jay Bahukhundi, both mid-level NSEL Executives, Nilesh Patel, Managing Director of NK Proteins and Arun Sharma, a film financier and CMD of Lotus Refineries. NK Proteins and Lotus are among biggest defaulters of NSEL.
An FIR was filed in September against NSEL directors Shah, Massey and others, charging them with cheating, forgery, breach of trust and criminal conspiracy, among other offences.
The now defunct spot commodity bourse, promoted by the Shah-led Financial Technologies, has been facing problems in settling Rs 5,600 crore dues of over 200 member-brokers, representing 13,000 investor-clients.