NSEL crisis: 5 defaulters promise to pay Rs 1,330 crore

With the National Spot Exchange initiating civil and criminal proceedings against its 19 defaulters, investors may be slightly relieved as five of them have promised to pay back Rs 1,330 crore. The amount will be paid from their collateral of Rs 1,450 crore which will be given to the exchange, reports CNBC-TV18’s Varinder Bansal.

It is the first time that the exchange has come out and given its position on the issue.  Due diligence and valuation will be conduced over the next few days. Also read: Equity markets insulated from issues in other segments: UK Sinha Commodities, which are under NSEL control, are being auctioned. Last week, the NSEL had promised most of the broker associations of having commodities worth nearly Rs 300 crore. The last and fourth payout of Rs 7.77 crore was made out of the sales from them. The key takeaway is from the chartered accountants' (CA) revelations. Their CA Sharp and Tannan Associates confirmed NSEL payment of over nearly Rs 5,500 crore to these brokers. So the claim of investors will not fall on NSEL but on the borrowers, who have been paid by NSEL. Sharp and Tannan Associates also confirmed physical verification of gold, silver, platinum and base metals in the E-series contracts. The stocks in the warehouses clearly show that the SGX report is being worked on. From the nine warehouses, significant shortage of stocks has been seen in seven defaulters’ cases. Also, there were 29 warehouses, where the audit team was not allowed.