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6 top CSE brokers arrested for payment default

Six leading brokers of Calcutta Stock Exchange have been arrested and remanded in police custody for their alleged role in the payment crisis at the bourse nearly one and half years ago which led to the crash of exchanges across the country.

The Kolkata police arrested the brokers - Harish Chandra Biyani, Ramesh Chandra Biyani, Raj Kumar Jain, Gopal Singhania, Vijay Singhania and Basudeo Singhania - from their residences late on Tuesday night.

The brokers were charged with indulging in circular trading and violating CSE regulations. The six were produced before the Chief Metropolitan Magistrate S C Mishra on Wednesday who remanded them to police custody till October 4.

The public prosecutor said the accused had not only violated the Calcutta Stock Exchange conditions on payment of margin and security money but also involved in circular trading to inflate prices of shares to defraud the public to the tune of Rs 120 crore (Rs 1.20 billion).

The arrests followed the CSE obtaining a decree from the Calcutta High Court for recovering Rs 5.82 crore (Rs 58.2 million) from D K Singhania and the filing of three civil suits and a number of other cases under the Negotiable Instruments Act against brokers for bounced cheques, as part of its initiatives to recover funds.

The brokers were initially involved in default of payment of nearly crore in March 2001 which led to the crash in all major exchanges of the country.

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