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EOW arrests 31 accused in NSEL scam

Press Trust of India  |  New Delhi 

The economic offences wing (EOW) of Police has arrested 31 accused, including defaulting borrowers and brokers, in the Rs 5,600 crore NSEL scam, the Centre informed today.

Capital markets regulator has completed audit of books of accounts of five commodity brokers whose names appeared in the interim report of the EOW. Thereafter, the show cause notice was issued on October 28, it said.

Asked if the has taken action against all the defaulters and brokers, Minister of State for Arjun Ram Meghwal said in the Rajya Sabha: "EOW, Police has arrested 31 accused including 22 defaulting borrowers, six NSEL key management personnel and three brokers."

The charge sheets have been filed against the accused in the under the Protection of Interest of Depositors (in Financial Establishments) Act, 1999, he said in a written reply to the Upper House.

Various agencies including the EOW and enquiring into the National Spot Exchange Ltd (NSEL) related payment and settlement crisis case, he added.

On action taken to recover money from NSEL defaulters, the minister said that the EOW has are ported that they have attached assets worth Rs 8,583.05 crores, approximately under various provisions of MPID Act.

"Rs 527.19 crores have been distributed to investors, 608 investors having invested less than Rs 2 lakhs have been fully paid, 50 per cent of the invested amount has been distributed to investors who invested between Rs 2 lakh and Rs 10 lakhs and 6 per cent amount distributed to investors who invested between Rs 10 lakh and Rs 5 crore and above," he said.

Besides, 19 provisional attachment orders involving assets worth Rs 8,37.01 crores against 12 NSEL defaulters have been issued by the Directorate of Enforcement.

"All these attachment orders have been confirmed by the adjudicating authority under the Prevention of Money Laundering Act, 2002. A prosecution complaint has also been filed before the Special against NSEL and 67 other accused persons," Meghwal said.

That apart, Securities and Exchange Board of India (SEBI) has completed audit of books of accounts of five commodity derivative brokers whose names appeared in the interim report of EOW, Police.

"Thereafter, the designated authority, appointed by for conducting enquiry into the matter, issued show cause notice on October 28, 2016," he said.

Replying to another query that if certain banks are providing payment and settlement system (PSS) service to NSEL without RBI and approval, the minister said: "At present, NSEL is not authorised to undertake activity for which payment and settlement system service of banks may be required.

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Tue, November 29 2016. 15:57 IST