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Corporate affairs ministry sends notices to auditors in NSEL, FTIL case

Notices have been sent for violations of Companies Act

Press Trust of India  |  New Delhi 

Jignesh Shah
Jignesh Shah

At least three auditors have come under the scanner of the corporate affairs ministry for alleged lapses in their audits of crisis-hit National Spot Exchange Ltd (NSEL) and its promoter group Financial Technologies (India) Ltd (FTIL).

The ministry has issued showcause notices for the lapses in auditing the books of NSEL and FTIL, according to a senior official. The notices have been sent for violations of the Companies Act.

Besides, the ministry has sought clarifications from the law ministry, Securities and Exchange Board of India and Forward Commission (FMC) to finalise action against “gross violations” by FTIL and related entities.

In the wake of the Rs 5,600-crore payment crisis at the bourse, these and related entities have come under the scanner of multiple agencies for various violations.

The ministry has found “gross violations” by the FTIL board on corporate governance and is looking at the issue of 'fit and proper' status of directors, among others.

An inspection of NSEL books by the ministry had found the exchange’s board failed to perform its duties towards shareholders.

The interim inspection report, carried out by the Registrar of Companies, Mumbai, had found corporate governance failure at multiple levels, including lack of transparency, integrity, compliance and ethics.

First Published: Mon, March 10 2014. 22:43 IST
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