The Economic Offences Wing (EOW) of the Mumbai Police Crime Branch on Tuesday arrested directors of three leading broking houses in connection with the Rs 5,600 crore payment crisis at the National Spot Exchange Limited (NSEL).
According to EOW officials, Amit Rathi, director of Anand Rathi Commodities, Chintan Modi, director of India Infoline Commodities and CP Krishnan, whole-time director of Geojit Comtrade, were placed under arrest on Tuesday. The arrested trio will be produced in the special MPID court on Wednesday, where the EOW will seek their custody, Additional Commissioner of Police, Rajvardhan Sinha said.
“Around 139 brokers have traded through NSEL. During probe, replies of these three accused were found to be evasive …. They have been charged for cheating, forgery, criminal conspiracy and criminal misappropriation under the Indian Penal Code,” Sinha said. The fresh arrests bring total number of arrests in the case to 24.
According to investigations so far, Anand Rathi Commodities had a trading volume of Rs 19,130.2 crore in NSEL, while India Infoline Commodities and Geojit Comtrade executed trades worth Rs 9,183.48 crore and Rs 5,526.66 crore respectively, officials said.
Explaining the role of the broking houses in the alleged racket, Sinha said, “… broking houses made false assurances to investors with misleading statements… It was assured that the NSEL offers fixed returns on investments, and that it is a safe investment.”
Anand Rathi Commodities said the firm, its officials have fully co-operated with the agencies. “We have submitted the requisite information and documents as requested from time to time and clearly established that Anand Rathi Commodities did not make any illegal profits / enrichment.
We are disappointed at the turn of events and do not believe the arrest is appropriate in the circumstances,” it said in a statement.