Capital markets regulator Sebi on Tuesday barred five brokerage houses for up to six months from making fresh applications seeking registration as commodity brokers as they failed to meet 'fit and proper' criteria in the NSEL case. The affected brokerage houses include India Infoline Commodities, Anand Rathi Commodities and Geofin Comtrade (banned for 6 months each), and Phillip Commodities and Motilal Oswal Commodities Broker (for 3 months each). "There were enough red flags for a reasonable person to come to conclude that what was being offered as paired contracts on NSEL were not spot contract in commodities," Sebi said in five separate orders.
In September 2013, FMC was brought under the Finance Ministry.
The bourse had proposed to settle all dues amounting to Rs 5,574.31 crore (Rs 55.74 billion) in 30 weeks, according to a settlement schedule issued by NSEL on August 16.
India's corporate sector sees big ticket deals in 2013.
This article reviews what happened at NSEL, according to information available in the public domain, and reiterates what could be done to reduce the risk of similar scams.
Financial Technologies hogged the limelight after the stock plunged 65% today.
From what the crisis is all about to who all are affected, here are 10 FAQs.
The broader markets were battered heavily. BSE Mid-caps and Small-caps indices fell between 1-2% on the BSE.
NSEL, has up to Rs 500 crore (Rs 5 billion) daily turnover in e-golds.
The National Spot Exchange Ltd has urged the government's Food Corporation of India to reduce the permitted price if it wishes wheat to be auctioned under the government's Open Market Sales Scheme.
The National Spot Exchange Ltd (NSEL), an arm of Multi Commodity Exchange (MCX), is planning to launch gold and silver (bullion) contracts in spot market in Kolkata by end of this month.
The days of spot prices of gold differing from one city to another will soon be over.
Making a weak opening, shares of FTIL further tanked 45 per cent to Rs 105.5 -- its fresh 52-week low on the BSE.
The exchange also plans to start Futures trading in electricity, carbon credit, coal, freight index, weather index, real estate index and rain index after the amendment to the Futures Contracts Regulation Act is passed by the Parliament.
Around 200 brokers are said to be involved in the scam; they have been summoned for questioning. Major brokerages questioned by the EoW so far include Anand Rathi, Motilal Oswal, India Infoline and Geojit Comtrade.
Sebi filed a criminal complaint against the brokers with the economic offences wing, which on Friday registered a case under the Forward Contract Regulation Act 1952.
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MCX-SX was set up by FTIL and MCX, but they have been now classified as 'public shareholders' as against 'promoters' earlier, pursuant to a Sebi-ordered restructuring of its board and governance structure.
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The National Spot Exchange Ltd, promoted by Jignesh Shah-led Financial Technologies, is facing a Rs 5,600-crore (Rs 56-billion) settlement crisis.
Crisis-hit National Spot Exchange Ltd (NSEL) on Tuesday failed to pay investors any of the Rs 174.72 crore (Rs 1.74 billion) installment due to them, defaulting for the 13th straight time.
Chidambaram said NSEL was not a registered or recognised association under the FMC but got exemption even before it started its business.
Crisis-ridden bourse NSEL defaulted for the 12th straight time today as it could pay only Rs 11 crore to investors against a scheduled payment amount of Rs 174.72 crore (Rs 1.74 billion).
Leading stock exchanges BSE and NSE have barred three entities from trading on their platform after they defaulted on dues in connection with Rs 5,600 crore (Rs 56 billion) payment crisis at National Spot Exchange Ltd (NSEL).
Crisis-ridden bourse NSEL defaulted for the 11th straight time on Tuesday as it could pay only Rs 29 crore to investors against a scheduled payment amount of Rs 174.72 crore.
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The government asked the NSEL to become a responsible guarantor to the Rs 5,600-crore (Rs 56-billion) dues to investors and meet its commitments.
In terms of value, this translates into more than Rs 300 crore (Rs 3 billion) of delivered quantity.
This is the second such notice to the spot commodity exchange promoted by Financial Technologies India Ltd. A similar notice had been issued to the NSEL by the Consumer Affairs Ministry in 2012.
Chokshi and Chokshi, which was given December-end deadline to complete the audit of e-series contracts at NSEL, had sought extension to finish the work.
Crisis-ridden bourse NSEL paid about Rs 9 crore (Rs 90 million) against the scheduled payment amount of Rs 174.72 crore (Rs 1.74 billion), defaulting for the 17th straight time.
Jignesh Shah, the promoter of Financial Technologies India Ltd, on Wednesday resigned from the board of MCX Stock Exchange, amid continuing Rs 5,600 crore (Rs 56 billion) payment crisis at group company NSEL.
Crisis-ridden National Spot Exchange on Tuesday sacked its Managing Director and CEO Anjani Sinha and six other top executives on a day it failed to meet the first scheduled repayment to investors.
MCX said it has no exposure to crisis-hit NSEL, which has to settle dues worth Rs 5,600 crore to investors after it suspended trading.
The crisis-hit NSEL is promoted by Jignesh Shah-led Financial Technologies (India) Ltd.
Two days after Mumbai Police attached his properties, Jignesh Shah, director of the beleaguered National Spot Exchange Ltd, on Thursday told investigators that he was making "relentless" efforts to recover money from defaulters.
Crisis-ridden National Spot Exchange Ltd (NSEL) on Wednesday said its Delhi-based member Mohan India Ltd has agreed to pay to the exchange about Rs 771 crore (Rs 7.71 billion) in final settlement over the next one year.
In the last three financial years and in the current financial year till November 15, SFIO was asked to investigate 167 cases.
The Ministry of Corporate Affairs ordered the inspection of the books of accounts of NSEL and Financial Technologies India Ltd to ascertain if any rules under the Companies Act were violated, a senior official said.
The licence of MCX-SX is coming up for renewal before Sebi later this month.
The government on Tuesday said it is keeping a close watch on the developments in the crisis-ridden NSEL and will take action once reports of the two committees looking into the problems of the exchange are received.
Given the nature of the money stuck, investors are fast losing patience with the exchange.
In his capacity as an member of Parliament from South Mumbai, Minister of State for Telecom and Shipping Milind Deora today wrote to Prime Minister Manmohan Singh and sought his intervention to resolve the settlement crisis facing the National Spot Exchange Ltd.
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