On Wednesday, Sebi ordered impounding of "averted losses" worth over Rs 125 crore through alleged insider trading in MCX and its erstwhile promoter FTIL by 13 persons, including relatives of Shah and former top executives, with 'prior information' about the NSEL case.
Since then, multiple agencies including Sebi, the Directorate of Enforcement (ED) and the Reserve Bank of India (RBI) are probing the irregularities at the now-defunct NSEL.
MCX and FTIL, which is now known as 63 Moons Technologies, were founded by Jignesh Shah. In the wake of the Rs 5,600-crore scam at group entity National Spot Exchange Ltd (NSEL), FTIL sold its stake in the commodity exchange.
The Serious fraud Investigation office (SFIO) has shot off notices to all broking firms whose clients traded in commodity pair contracts on the National Spot Exchange. The brokers have been asked to furnish their books of accounts, a source told Moneycontrol.
Embattled Financial Technologies has told shareholders that it never got any money from NSEL's profit and also cautioned them against vested interests spreading rumours about the government order on merging the bourse with the company.
The EOW of Mumbai police on Tuesday attached assets of FTIL, under the Maharashtra Protection of Interest of Depositors Act (MPID) Act.
The NSEL-FTIL merger was recommended by the erstwhile commodities market regulator FMC. This suggestion was made after the Rs 5,600-crore payment default surfaced on the spot exchange
In the wake of the payment crisis, the Corporate Affairs Ministry last year ordered the merger of NSEL with its parent firm FTIL but that has been challenged by the exchange and the matter is now before the Bombay High Court.
The exchange said so far it has received details of only 3,600 investors against a 13,000 who claim to have lost around Rs 5,600 crore in the scam.
In a letter to BSE and NSE, FTIL said its Board is opposed to FMC's recommendations that NSEL be merged with FTIL and the government should take over management of FTIL.
Both MCA and the Finance Ministry have been debating over the recommendations submitted by the Forwards Market Commission (FMC) on the NSEL scam
The draft rules, on which public comments have been sought by September 15, come in the wake of Rs 5,600 crore payment scam at the National Spot Exchange Ltd (NSEL) that surfaced in July last year, exposing loopholes in the system.
Before the stock exchange was allowed to commence equity-trading operations, FTIL and its sister firm MCX had to commit to reduce their combined stake to a total of 5 percent by January 18, in order to comply with SEBI‘s manner of increasing and maintaining public shareholding (MIMPS) regulations.
FTIL and its promoter have filed a petition in the High Court challenging the recent FMC order which ruled that both were not fit to run any stock exchange in the country and asked for reducing its shareholding in MCX to 2 percent.
The board of MCX-SX would decide whether it would allow Financial Technologies to subscribe to its rights issue, MCX Vice Chairman Thomas Matthew said. MCX-SX, India‘s third national stock exchange run by MCX, is looking to raise Rs 500-600 crore via the rights issue.
The Securities and Exchange Board of India (SEBI) has issued a show-cause notice to FTIL asking why it should be considered fit to run MCX-SX and not be asked to divest its shares and warrants in the exchange, sources have told CNBC-TV18.
The order follows a probe into the Rs 5500 crore fraud at National Spot Exchange, a subsidiary of Financial Technologies.
These brokers were apparently working as Carrying and Forward (C&F) agents as well for National Spot Exchange (NSEL) without checking the veracity of commodities lying in the warehouses, and kept investors in the dark about non-availability of commodities on which their clients were taking positions.
MMTC has filed a case in the High Court against NSEL to recover its dues. MMTC has said that arrested former CEO of NSEL, Anjani Sinha was being made a scapegoat.
The Mumbai police probing the Rs 5,600-crore payout scam involving the National Spot Exchange Ltd (NSEL), has attached all 166 properties of defaulters it has identified so far and is all set to attach immovable assets of NSEL directors, including Jignesh Shah and Joseph Massey, a senior police officer said here today.
Under the agreement, Mohan India will pay Rs 11 crore (less than 1.5 percent of outstanding loan) upfront, and the remaining amount will be paid over the next one year.
Economic Offences Wing (EOW) also issued some notices against Jignesh Shah and said that they will not be allowed to leave India without permission.
A five-member panel will now oversee the auctions at NSEL, the Forward Markets Commission (FMC) said in a directive to the crisis-hit exchange.
The annual general meeting of the Multi-Commodity Exchange of India (MCX), scheduled for tomorrow, could well be a stormy affair as some NSEL investors plan to protest outside the venue.
In a fresh twist to the NSEL payment crisis, regulators now suspect that large-scale money laundering might have taken place through the exchange and the funds involved in such activities could be much more than the reported default amount of Rs 5,600 crore.