- NSEL crisis: Income-Tax Department conducts raids at brokerage firm's officesNSEL crisis: Financial Technologies shares nosedive over 14% as auditor withdraws reportOmaxe promoters to sell shares to meet Sebi normNSEL crisis: Financial Technologies' Jignesh Shah says he is victim of 'fraud'
Even as the government investigates the payments crisis on the National Spot Exchange (NSEL) and the Forward Markets Commission (FMC) assesses whether the exchange’s promoters should be stripped of the “fit and proper” tag, the Jignesh Shah-promoted Financial Technologies India Ltd (FTIL) will now be probed by the Securities and Exchange Board of India (Sebi).
The decision came a day after the firm’s auditors Deloitte Haskins & Sells said the accounts were no longer to be relied on following the payments problems at NSEL. The Financial Technologies stock lost 10% on Wednesday, closing at R150.25 on the BSE.
FTIL, which houses the software business of the group, holds 26% in Multi-Commodity Exchange (MCX), 99.9% in NSEL and 5% in MCX Stock Exchange (MCX-SX) and 33.5% in IEX, a power exchange.
Speaking on the sidelines of an event in Mumbai, Sebi whole-time member Rajeev Agarwal said on Wednesday the regulator will “ascertain facts from FTIL on the audit report”, adding it would “examine the findings of other regulators” and act if there is any breach of the ‘fit and proper’ criteria.
Meanwhile, Joseph Massey, a close aide of Jignesh Shah and the head of MCX-SX has decided against seeking reappointment as a director of MCX. According to a stock exchange filing, Massey - will retire as director on September 30. “...Joseph Massey, retiring director, who had earlier offered himself for re-appointment, has withdrawn his consent for reappointment as a director at the ensuing annual general meeting and has expressly conveyed vacating his office as a director w.e.f. close of business hours on September 30, 2013,” the filing said.
The FTIL annual general meeting held in Chennai on Wednesday turned out to be a stormy affair with shareholders questioning the board of directors on the crisis at NSEL. With only a handful of shareholders attending the much-awaited meet, chairman Jignesh Shah attempted to win shareholders’ support at a time when he is struggling to recover more than R5,500 crore to tide over a settlement crisis.
Asked how much time it would take to set things right, Shah replied: “You have to ask Lord Balaji.”
On the issue of the auditors withdrawing their report, Shah said: “It will be recast based on NSEL’s new feedback.”
Deloitte informed the company on September 23, that “ in accordance with the