The economic offences wing (EOW) of Mumbai Police’s crime branch on Wednesday arrested Jignesh Shah, director, National Spot Exchange Ltd (NSEL), and Shrikant Javalgekar, group financial controller, NSEL, in connection with the probe into the Rs. 5,600-crore fraud on NSEL.
NSEL stopped trading on July 31 last year after defaulting on Rs. 5,600-crore payment obligations to market participants. It also did not allegedly have physical stocks of the commodities that were pledged as collateral.
"They were summoned by EOW on Wednesday for questioning. They were also questioned on several earlier occasions but evaded crucial questions. This necessitated their arrest for custodial interrogation," said Rajvardhan Sinha, additional commissioner of police, EOW. With the latest arrests, the total number of persons arrested in the case so far has gone up to 11.
On January 6, the EOW had filed a 9,800-page charge sheet in the NSEL scam before the Maharashtra Protection of Interest of Depositors court.
The EOW had registered a case against Financial Technologies India Limited (FTIL), board of directors of NSEL including Jignesh Shah and 25 companies for criminal breach of trust, forgery and conspiracy. EOW has already frozen 80 accounts related to the accused in the case.
The investigations showed that brokers allegedly favoured by NSEL were allowed to trade on their clients’ accounts without their knowledge. EOW officials alleged that Shah had allegedly approved various contracts.
So far, the EOW has secured Rs. 5,100 core of the Rs. 5,600 crore fraud, Sinha said.