Dr. Kirit Somaiya -n*v.v. crcdk *tdil qdl Chanered Accountant, Ph.D. Bharatiya Janata Party To 166 August 2013 The Enforcemetrl Directorate Mumbai. Sub: Cheating, fraud, forgery money laundering Ref: National Spot Exchange Scam ofRs.8,000 crore. Sir, It is clear now that forgery, benami transactions; money larurdering has taken place at NSE e..g. l. Juggernaut Projects Ltd Mumbai 2. N K Proteins It is understood that several such companies/owners have entered into benami transactions, opened bogus companies, fake warehouse receipts...companies opened in the name ofd vers, peons etc. tuggemaut Projects incorporated ot 24/4/2013 with Rs 5 lac paid up capirar. AI the 3-founderhresent directors are directors in only 1 companies. i.e. rhis company Juggemaut. The directors seem benami, poor persons. This company had en cash hundreds crores fiornNSEL ind now defaulted. The National Spot Exchange Limited (NSEI) got-burst few days back, is in a way closed down, resulting into loss ofhard eamed savings ofsenior citizeni, farmers and otha.r. Ou. ol."*utlon./ complainis: . NSEL refused to pay the dues to 12,000 innocent farmers and small investors. . NSEL is not regulated by any other Act. . Government oflndia has exempted NSEL from regulatory network in 2007_08. o Various conditions were laid down for such exemption. . Conditions violated, forgery took place and ftaudulent activities unde(aken. o Economic offences, money laundering, conupt practices, cheating, ftaud tookplace at NSEL. . Forged documents regarditg stoclq liquidity. ' Forged decraration about the stocks, bogus forged warehouses receipts, warehouses stock position. . Same stock pledged with more than one financial institution. . The registered office ofNSEL is in Mumbai. . R:89q0cr9T scam.took place due to the _cotrnivance of promoters, owners, members of NSEL, officials of Forward Market Commission (FMC; and officiais oi Consumer Allairs Ministry. --, . The Consumer Affairs Ministry without creating regulatory network accorded permission,ixempted NSEL. o Conditions laid down by the Ministry ofConsumer Affairs were not implemented by NSEL. . Forward Market Commission and Consumer Affairs Ministry did not kee! watch on the activities of \SIL. o NSEL meant for spot tEnsactions, were abused and misused as vayda Bazarl Badala and also used to create afiificial liquidity. 9C, Neelam Nagaq Mulund East, Mumbai 400 'Bt .Telt 21634152/21639649 o bax:022_21637432 E-mail: [email protected], [email protected]. w"-t.i " , *.-.hritsomaiya.com
Transcript
Dr. Kirit Somaiya -n*v.v. crcdk *tdil qdlChanered Accountant, Ph.D.
Bharatiya Janata Party
To 166 August 2013
The Enforcemetrl DirectorateMumbai.
Sub: Cheating, fraud, forgery money laundering
Ref: National Spot Exchange Scam ofRs.8,000 crore.
Sir,
It is clear now that forgery, benami transactions; money larurdering has taken place at NSE e..g.l. Juggernaut Projects Ltd Mumbai2. N K Proteins
It is understood that several such companies/owners have entered into benami transactions, opened boguscompanies, fake warehouse receipts...companies opened in the name ofd vers, peons etc.
tuggemaut Projects incorporated ot 24/4/2013 with Rs 5 lac paid up capirar. AI the 3-founderhresentdirectors are directors in only 1 companies. i.e. rhis company Juggemaut. The directors seem benami, poorpersons. This company had en cash hundreds crores fiornNSEL ind now defaulted.
The National Spot Exchange Limited (NSEI) got-burst few days back, is in a way closed down, resultinginto loss ofhard eamed savings ofsenior citizeni, farmers and otha.r. Ou. ol."*utlon./ complainis:
. NSEL refused to pay the dues to 12,000 innocent farmers and small investors.. NSEL is not regulated by any other Act.
. Government oflndia has exempted NSEL from regulatory network in 2007_08.o Various conditions were laid down for such exemption.. Conditions violated, forgery took place and ftaudulent activities unde(aken.o Economic offences, money laundering, conupt practices, cheating, ftaud tookplace at NSEL.. Forged documents regarditg stoclq liquidity.
' Forged decraration about the stocks, bogus forged warehouses receipts, warehouses stock position.. Same stock pledged with more than one financial institution.. The registered office ofNSEL is in Mumbai.. R:89q0cr9T scam.took place due to the _cotrnivance of promoters, owners, members of NSEL,officials of Forward Market Commission (FMC; and officiais oi Consumer Allairs Ministry. --,. The Consumer Affairs Ministry without creating regulatory network accorded permission,ixempted
NSEL.o Conditions laid down by the Ministry ofConsumer Affairs were not implemented by NSEL.. Forward Market Commission and Consumer Affairs Ministry did not kee! watch on the activities of\SIL.o NSEL meant for spot tEnsactions, were abused and misused as vayda Bazarl Badala and also usedto create afiificial liquidity.
. The illegal activities were stafied way back in 2010.r Forward Market Commission and the Ministrv offraudulent activities in 2011-12.
Bharatiya Janata Party
. They wrote to NSEL in early 2012 but did not take firm action.e The fraudulent activities were alowed to be continued at NSEL ti the first week ofAugust, 2013by Forward Market Commission and Consumer Affairs Ministrvo This has resulted in a scam ofRs.g000/- crore and loss to 17,000 farmers and small investors,. It is understood that couple ofpSUs also lost hundreds ofcrores in this scam.
Consumer Ministry while exempting the NSEL laid following conditions on 5 June 2007
LNo short sale by members ofthe Exchange shall be allowed2 All outstanding positions ofthe trade at the end ofthe day shall result in delivery.3 The Consumer Ministry & FMC found viotation earty on :Z april jOt2 a issue notice to NSEL4 Ministry and FMC allowed NSEL ofcontinue the-scam & ir.uiJ rtppug" o.a., on 6 August 2013i.e. after lapse of 16 months when scam rose to g,000 crore
We would request investigation by ED for benami tmnsactions, money laundering and also vioiation of
We rcquest you to register an FIR and lodge a criminal case against -a) Promoters/ownersofNSEL.b) Officials ofNSEL.c) Olfrcials of FMC.d) Officjals of M in istr) of Consumer A ffairs. Covernmen r o f lndia.e) tsrokers/Warehouse keepers who have issued forged/false documents/informationlt Jucn compantes. pelsons
Please treat this as our regar compraint and register an FIR under Ipc/cr pc and MprD.
Thanking you,
Yours tuly,
^.Ji r (1UN4[Dr. Kirit Somaiya, Ex. M?lPresident, Investors' GrievaDces Forum
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Press Release
.,: \l'I National Spot ll!. Erchauge -/
Proposed settlement cvcle
Mumbai 4d August'2013r
As per circular issued bythe Exchange, the Exchange suspended trading and mergedthesettlement cycles ofall one day forward contracts (otherthan e-a".i"" aont uat"]on 31" Jul, 2013. The said action was taken due to certain abrupt structuralchanges in the market place leading to disruption. This situation was aigravated bythe Ioss of trading interest, due to uncertainties leading to ade in-equilibrium.However, the Exchange is fully committed to ensure proper settlement of alloutstanding obligations and to comply with the directions issued by theGovernment in dlis regard and to settle all issues as per Rules and Bye laws oftheExchange.
Mr. Anjani Sinha, MD & CEO ofthe exchaxge stated that in the interest of aBiving ata consensus and satisfactory solurion for settlement of dues in ".ao"a"ni"'"itflExcnange Rutes and Bylaws, he held va ous meetings with the Members of the
Exchange and the buyers/ processors. These meetings?ere atso airn"i'", ""*"*"avoidance ofany incidence, which may have consequential impact on turg",rrl".k;l
He also held meetingswith the Forwa;d Mart<ets commission iflvLcj. - "- "-'
H-e-expressed. confidence over handling large quanfum oF pay_iu /payout obliqaticnar rne same ttme. However, in case of declararion of defauli by any member,
_which
-"i]9 lTd ]: a long litigation process. the rol".i"g ;;ii;#h;;e u"""l.l,p"*aand the final decision would be raken after due consultation wich all statelifiJrs.
Option 1:A. There are 8 members/ processors, who are willing to pay as per the
scheduled due date or even earlier. The total "^ounJp"rt"ining to'aual, e
members is Rs. 21g1crores.
B. There are 13 members/ processor' who have offered to pay 5 0/o of theirtotal dues every weell, ifthe same is agreed upon, foa"t ulnourr, "on1".
,o ea.3107 crores approximately. Name ofsuch members are as follows:
i National SDot iv. rrxcnaDge.cl
C. There are 3 processors with whom negotiation is still going on. The amountpertainingto these parties comes to Rs.311 crore.
SEUsn-2r.The exchange is in possession of post dated cheques (pDC) from vafious processorcamounting to Rs. 4900 crs. against their settlement obligation and balance partieshave confirmed payment regularly. \ r'hile pDCs are a commitment, the payoutprocess may not roll out smoothly in a month,s time. Hence, the market parti;ip;ntshave proposed 0ption 1as a safer alternative
FMC Officiais have also asked for details of Membe6 planters and otherparticipants who are noi cooperating with the Exchange in resolving fhe manerretated to seftlement cycle. The FMC along with other Government agincies wouldwork together to ensure a safe and secure settlement ofdues.
For fuffher iiformation. confaff.Dilip Tambe - National Spot Exchange [email protected](anationalspotexchanse,comCellrBB79002070
