Crisis-ridden National Spot Exchange Ltd (NSEL) 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.
National Spot Exchange Ltd (NSEL) could settle only Rs 92.12 crore out of the scheduled of Rs 174.72 crore payment it had committed to the sector regulator FMC.
This was largely because nine NSEL members failed to pay their dues.
The NSEL had to shut down its operation early this month following the government direction in the wake of violation of certain rules. It has given seven-month plan to settle Rs 5,600 crore to investors.
“The Board decided that the current Key Management team headed by Anjani Sinha – MD & CEO and other relevant heads of departments be removed from their current assignments,pending an enquiry,” NSEL said in a statement.
NSEL chief financial officer Shashidhar Kotian is also fired.
The other five executives are Amit Mukherjee (Assistant VP – Business Development),Jai Bhaukhundi (Assistant VP Market Operations),Maneesh Chandra Pandey (Manager – Business Development),Santosh Mansingh (Assistant VP – Market Operations),H B Mohanty (Assistant VP – Market Operations)
The Board meeting was held yesterday to identify measures to be taken to solve the problems in NSEL.
“Sinha will cease to be the MD & CEO of NSEL with effect from August 20,2013 and he will be a Special Officer assisting in recovery process,” the exchange said.
The Board has appointed P R Ramesh as the “Officer on Special Duty” (OSD) to exercise all powers of a CEO of the Company and will report to the Board directly.
NSEL said 15 members (buyers) have made payment of Rs 92.12 crore today,while nine of them have defaulted.
The defaulter members include Ark Imports Pvt Ltd,Loil Overseas Foods Ltd,Lotus Refineries Pvt Ltd,N K Proteins Ltd,NCS Sugars,Spin Cot Textiles,Tavishi Enterprises,Vimladevi Agrotech and Yathuri Associates,it said.
The exchange disbursed Rs 92.12 crore to 151 investors (sellers) including state-run firms MMTC and PEC Ltd and many brokerage firms. Rs 19.16 crore was also paid to NSEL’s related entity Indian Bullion Market Association (IBMA).
Members of the NSEL have been directed to further disburse this amount in the same proportion to all clients against their unsettled obligations,the exchange added.
NSEL also said it would appoint forensic auditor by Friday this week to assess the exchange and members’ financial and settlement accounts,including the delivery and collateral management system.
The assessment of quality and quantity of goods lying in various warehouses would be done by SGS by the end of the month,it said.
“The exchange will take necessary legal and regulatory measures in case of any non-compliance with the collaterals lying in various warehouses,” the statement said.
A special helpline has been set to attend the complaints and concerns of members and investors who can call on 022-67619922 during the normal office hours,it added.
Besides,the NSEL said it is also conducting a special investigation under the Officer on Special Duty (OSD) to identify various lapses that may have been caused in the operation of the Exchange and to suggest corrective and consequential actions for recovery of outstanding dues.