Around 50 investors of the beleaguered National Spot Exchange Limited ( NSEL) on Wednesday submitted a two page demand to Joint Commissioner of Police Crime Himanshu Roy, demanding a speedy probe against the company’s directors. The petition came a day after the Mumbai police started attaching properties of the vice-chairman of NSEL.
"The police has recorded the statement of one of the directors, Srikant Javglekar but he hasn’t been arrested so far. We want him to be taken into custody as his statement will directly indict Jignesh Shah," one of the investors told The Hindu.
On September 30, an investor had filed an FIR against the directors and key management persons of NSEL for cheating, forgery, criminal breach of trust and conspiracy. The FIR stated that the accused had hatched a criminal conspiracy to defraud the investors and misrepresented that they were investors and induced them to trade on the NSEL platform by creating forged documents like bogus warehouse receipts thereby defrauding the clients.
Five people including the CFO, Anjani Sinha, two vice presidents, Amit Mukherjee and Jay Bahukhundi, and two borrowers have already been arrested by the Mumbai police, who claim more arrests are likely.
JCP Roy told the press, "We have already started freezing the assets of the company. The matter of arrest is a matter of strategy…We have seized the shares of Mr. Jignesh Shah yesterday and are doing what is legally viable, " Mr Roy added.
The police are planning to liquidate the assets as soon as possible to help the investors. "Some of the investigators have told us that they have pressing needs like family emergency, etc. Once the liqudation of assets take place, the fund shall be released on pro rata basis," Mr. Roy said.
The article has been edited to incorporate the following correction:
In the Business page story titled “Investors demand speedy probe of NSEL directors”, (Dec. 5, 2013) NSEL was wrongly expanded as National Stock Exchange Ltd. instead of National Spot Exchange Ltd.