NSE board approves CBI to indict Chitra Ramakrishna in co-location scam

The NSE board has approved a probe into the co-location scam by the Central Bureau of Investigation (CBI), according to a report.

Since Chitra Ramakrishna was arrested last March, the CBI has been waiting for the board of the National Stock Exchange (NSE) to approve her prosecution. Almost four years after the agency registered an FIR in May 2018, she was arrested in the co-location scam.

A CBI investigation is being conducted into the alleged improper distribution of information from market exchange servers to stock brokers. Within the exchange premises, the NSE offers a co-location service for stock brokers, who can rent specific racks for co-locating their servers and systems.

During a board meeting on February 7, the NSE board approved the prosecution of top officials, including Ramakrishna, in the co-location scam in which some brokers allegedly got preferential access to high-frequency trading.

Following a Delhi High Court ruling last September, Ramakrishna was released on bail. The court also granted her bail in a money-laundering case related to alleged illegal phone tapping and snooping on NSE employees filed by the Enforcement Directorate (ED).

The former managing director of the NSE, arrested earlier by the CBI in the co-location scam, was picked up on July 14 by the Enforcement Directorate in the money laundering case.

Capital markets regulator Sebi prohibited Ramakrishna and Ravi Narain, who also served as the MD and CEO of NSE, from associating with any listed company or market infrastructure institution or any other market intermediary for five years in the co-location case in April 2019. During a certain period, they were also ordered to disgorge 25 percent of their salaries.

The Securities Appellate Tribunal (SAT) set aside the market regulator's order against Ramakrishna and Narain in February.

The NSE appointed her as joint managing director in 2009, and he served in the position until March 31, 2013. On April 1, 2013, she was elevated to the position of MD and CEO. In December 2016, her tenure at NSE came to an end.

With inputs from PTI