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Financial Technologies India shares pare early gains,stock falls 4.5 pct

Shares of FT Group promoted MCX also fell by 1.71 per cent to Rs 402.15.

Written by PTI | Mumbai | Published: September 27, 2013 7:25:13 pm

Surrendering the initial gains,shares of Financial Technologies India Ltd (FTIL) closed down by 4.5 per cent today,triggered by fresh troubles at NSEL.

A possible collusion between the exchange officials,brokers and clients,including HNIs and politically connected entities,has come to the fore in the NSEL matter being probed by multiple agencies and regulators.

Despite making a strong opening,FTIL’s shares went into a tailspin during the fag-end trading session and dropped 4.47 per cent to settle at Rs 150.80 on the BSE.

Shares of FT Group promoted MCX also fell by 1.71 per cent to Rs 402.15.

Preliminary investigations conducted by capital markets regulator Sebi and inputs from other regulators and government departments suggest that some brokers were offering structured financial products to their HNI clients under some portfolio investments schemes for high returns of 10-20 per cent.

The brokers are believed to have been working in close coordination with some top officials at National Spot Exchange Limited (NSEL),as also certain other group entities,while many of the clients could also have been in the loop about such structured products being in contravention of the extant norms,a senior official said.

While investigations are in initial stages,further evidence in these directions could lead to formal proceedings against the suspected entities under regulations governing fraudulent and unfair trade practices,portfolio management schemes and rules governing code of conduct of market intermediaries,he added.

Sebi is also ascertaining facts from Financial Technologies on withdrawal of report by its auditor.

Deloitte Haskins & Sells had withdrawn its audit report certifying accounts of the company for FY’13 fiscal as about Rs 5,450-crore payment crisis at NSEL ballooned.

Meanwhile,widening its probe into the NSEL matter,the Corporate Affairs Ministry has sought financial reports and other details from the spot exchange’s parent firm FT Group and other related entities.

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