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In another significant development in the cloud surrounding the Financial Technologies (FTIL) group, National Bulk Handling Corporation (NBHC), a group company, has been found to have traded on the Multi Commodity Exchange (MCX).
This is a breach of rules, which do not permit a related party to trade on a commodity exchange of the same group.
According to information with the Forward Markets Commission (FMC), the trading by NBHC on MCX was insignificant and, hence, the regulator had not taken any action. However, regulatory sources said NBHC's deals would be covered as a part of the special audit of MCX being ordered by the regulator. FMC has not decided on the auditor to be so assigned.
According to information, NBHC had only traded for a day or two. Paras Ajmera, a director on the board of MCX, nominated by FTIL, is also a director on NBHC. In view of the latest revelation, Ajmera is understood to have decided not to get himself reappointed on the board of MCX. At present, he is the only representative from FTIL on the MCX board. In his absence, FTIL is likely to choose another nominee. It holds 26 per cent stake in MCX.
Recently, the Indian Bullion Merchants Association, a subsidiary of the crisis ridden National Spot Exchange, also an FTIL company, was also found to have traded on MCX. That became a big issue for MCX, as the regulator had taken a serious note of this.
