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Former NSEL chief executive Anjani Sinha gets bail

LiveMint logoLiveMint 09-05-2014 Khushboo Narayan

Mumbai: The Bombay high court on Friday granted bail to Anjani Sinha, former chief executive officer (CEO) of National Spot Exchange Ltd (NSEL), and two others in connection with the `5,574.34 crore payment crisis at the commodity bourse.

Sinha was arrested on 17 October by Mumbai Police’s economic offences wing (EOW) in connection with the payments crisis, after the arrests of Jai Bahukhandi, former assistant vice-president of warehousing at NSEL, and Amit Mukherjee, former assistant vice-president of business development.

NSEL is 99.99% owned by Financial Technologies (India) Ltd (FTIL).

The bail was set by the court at `5 lakh each, and they were asked to appear before the EOW every Sunday.

Earlier this week, Jignesh Shah, chairman and group chief executive of FTIL, was also arrested in connection with the crisis at NSEL. Shah’s arrest was the 10th and the most significant in the case since the crisis began in July.

The crisis at NSEL came to light on 31 July. Subsequent investigations have highlighted the possibility of fraud and, according to the Forward Markets Commission, the involvement of promoters.

Meanwhile, the board of Multi Commodity Exchange of India Ltd (MCX), a unit of FTIL, formed a committee of senior executives who will manage the daily affairs of the exchange under the supervision of a committee of board directors.

The move has been necessitated due to the resignation of managing director and CEO Manoj Vaish. According to a stock exchange announcement, the board “accepted the resignation of Dr. Manoj Vaish-Managing Director & CEO, who will be relieved with effect from May 10, 2014.”

The board of the commodity futures bourse, which met on Friday, also approved the alteration of the Articles of Association of the company to incorporate the new ownership and shareholding norms laid down by the Forward Markets Commission (FMC).

On 6 May, the commodities market regulator said that any entity found to be unfit to run a commodities exchange will have to sell its shareholding. The entity will not have any voting rights till its shares are sold, according to the FMC notification.

In a separate announcement, the exchange also said it has initiated action against certain employees based on the issues highlighted in the special audit report prepared by PricewaterhouseCoopers (PwC).

“Company has initiated certain actions such as filing complaints before appropriate authorities; and issued notices to certain employees,” said the announcement.

The report of the special audit done by PwC, the summary of which was released last week, raised questions around so-called related party transactions and questioned whether dealings between the exchange and its parent FTIL had been conducted at “arm’s length”.

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