SEBI to ‘examine’ and take ‘necessary action’ in NSEL Case: Jaitley

Market regulator SEBI has been given power by the centre to ‘examine’ and ‘take necessary action’ against defaulting brokers of NSEL, as revealed to the Parliament. The move broadly corroborates with Jignesh Shah and the FTIL fraternity at large as they have been pushing for deep-rooted investigations into broker and marketmen transgressions.

Besides the Corporate Affairs Ministry, the Economic Offences Wing (EOW) of Mumbai Police and the Directorate of Enforcement are also investigating the NSEL case, Arun Jaitley, Corporate Affairs Minister, said in a written reply to a Lok Sabha question.

Jaitley also revealed that 50,389 representations (physical Papers as well as emails) were received during March 2015 to October 2015 in relation to the public notice issued by the Corporate Affairs Ministry on the draft merger order.

SEBI, which hasbecome the regulator of commodity markets now, has already begun the audit offive brokers who appeared in the March 31 interim order of Bombay High CourtCommittee on NSEL, it is learnt.

The five brokers being probed are Anand Rathi Commodities, India Infoline Commodities, GeofinCommtrade, Phillip Commodities and Motilal Oswal Commodities.

In its interim order passed on March 31, the Bombay High Court--appointed committee had highlighted discrepancies of the brokers in NSEL case such as misuse of client code, false assurances, routing of black money etc.

Meanwhile, Jaitley said in his written reply that representations had been received asking for early action against the miscreants for the National Spot Exchange Limited (NSEL) case.

He further stated that properties valued at Rs. 5,757 crore of the accused have been attached by EOW while 32 common properties valued at Rs. 740 crore (by ED) and Rs. 1,222.89 crore (by EOW) have been attached.

"Further, directions have also been given to the SEBI to examine and take necessary action against the defaulting brokers", Jaitley said.

With Jaitley committed to speed up justice in this case, there’s hope for the shareholders of Jignesh Shah promoted FTIL, which is still awaiting court’s decision for its ill-advised merger with NSEL. As parent company, FTIL is cited to be burdened with a financial sum of Rs. 5,600 crore – a clear breach of the concept of limited liability.

As many as 45,803 FTIL shareholders have opposed the merger of NSEL with FTIL, Jaitley's reply revealed.