Published: Fri, July 15, 2016
Economy | By Melissa Porter

ED Arrests Jignesh Shah For NSEL Scam Case

ED Arrests Jignesh Shah For NSEL Scam Case

Shah was arrested late on Tuesday as he refused to cooperate in the investigations after he was grilled all day.

The Enforcement Directorate on Tuesday arrested Financial Technologies India Ltd (FTIL) founder Jignesh Shah in connection with its probe into the Rs5,600-crore National Spot Exchange Limited (NSEL) money laundering scam.

Jignesh Shah, promoter of Mumbai-based Financial Technologies which operates Multi Commodity Exchange (MCX), was arrested under the provisions of the Prevention of Money Laundering Act (PMLA).

A senior ED official said, the agency has allegedly unearthed fresh evidence of money laundering against Shah and a string of companies associated with him.

ED had registered a criminal case under the PMLA in 2013 to probe the case, along with the Economic Offences Wing (EOW) of Mumbai police. Last Thursday, the special court on money laundering offered some respite to the 68 accused in the NSEL scam who were supposed to make a personal appearance before the court.

ED in its charge sheet had said that the accused routed the money through various channels and invested in assets in the country and overseas. One of the routes the money followed was repayment of loans taken overseas by other companies. These companies are subsidiaries of FTIL.

These companies are the subsidiaries of the Financial Technologies India Ltd (FTIL), which holds 99.99 per cent stake in NSEL, controlled by Shah, which indicated his primary involvement as the mastermind and ultimate controller of these entities.

NSEL's payment troubles started after it was ordered by the Forward Markets Commission in July 2013 to suspend the spot trade due to suspected trading violations.

A 63 Moons spokesperson has said, "We fail to understand why such a coercive step has been taken by the Enforcement Directorate when Mr. Shah has been fully co-operating with the investigation and has been going every time he has been called, including today, especially when ED's own complaint has failed to establish any money trail to either Mr. Shah or 63 moons".

It was found that goods against which borrowers were raising money from 13,000 investors were virtually non-existent.

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