The board of Multi Commodity Exchange of India Ltd. (MCX), on Thursday, asked promoter Financial Technologies India Ltd (FTIL) to reduce its stake to 2 per cent, in accordance with the Forward Markets Commission’s (FMC) order.

Last week, the FMC had issued an order, declaring FTIL and its chief Jignesh Shah unfit to run any exchange, including the MCX, following a Rs.5,500-crore payment crisis at group company National Spot Exchange Ltd (NSEL).

The regulator also charged Mr. Shah with being the “highest beneficiary of the fraud perpetrated” at NSEL.

The NSEL, which is promoted by FTIL, has been defaulting on payments to 13,000 investors. It was plunged into the payment crisis after halting trading in commodities from August 1 on a government directive.

The MCX board of directors at a meeting on Thursday decided to advise FTIL to implement the FMC order by reducing its stake in the company to 2 per cent or below from 26 per cent within one month, the company said in a BSE filing.

The country’s largest commodity exchange also decided to withdraw the representation of FTIL official Miten Mehta on its board, as per the regulator’s directions.

FTIL and Mr. Shah have already moved the Bombay High Court, challenging the FMC order. Their petition seeks to quash the FMC order declaring FTIL not a ‘fit and proper person’ to hold anything more than 2 per cent of the equity in MCX.

Mr. Shah founded MCX in November and then went on to set up a stock exchange this year. He is now the Chairman of FTIL, which owns and runs NSEL.

Mr. Shah quit as Vice-Chairman and shareholder director of MCX Stock Exchange on October 9. A few weeks later, he resigned as MCX Vice-Chairman.

MCX shares rose 0.03 per cent to close at Rs.472.60 on the BSE.

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