A statement from MCX-SX said that both Shah and Massey have resigned from the board of the equity exchange with immediate effect.
While Shah was the vice chairman & shareholder director of MCX-SX, Massey was the MD & CEO of MCX-SX and also the shareholder director of MCX-SX Clearing Corporation.
Last month, the Securities and Exchange Board of India (Sebi) renewed the licence of MCX-SX for a year, but included strict conditions to further secure the management of the exchange and clearing corporation.
The resignations come less than a week after the Forward Markets Commission (FMC) issued a showcause notice to Financial Technologies (India) which owns 5% in MCX-SX along with Shah, Massey and Shreekant Javalgekar who is the MD & CEO of MCX, which again owns 5% in MCX-SX.
The notice questions the 'fit & proper' status of the entities. A withdrawal of the 'fit & proper' status could have a bearing on FTIL's ability to remain the promoter of its commodity futures exchange MCX and its equity exchange, MCX-SX.While former LIC chairman Thomas Mathew T has been nominated a public interest director on the board of MCX-SX, whole-time director U Venkataraman will assist a special committee of public interest directors in managing the functions of the exchange.
Former NSEL staffer held
Meanwhile, the Economic Offences Wing (EOW) arrested Amit Mukherjee, a former employee of the spot exchange, on Wednesday. Mukherjee, who was sacked by NSEL on August 20 on charges related to mismanagement, was the former head of business development and, according to NSEL's former MD & CEO Anjani Sinha, the key person who introduced 25 entities that now collectively owe nearly R5,600 crore to the exchange.
According to sources, Mukherjee owns flats in Thane district and also has a couple of cars, including a Range Rover, which is registered in his wife's name. Mukherjee's salary at NSEL was around R20 lakh per annum. The arrest comes less than two weeks after the EOW registered an FIR, accusing all the promoters and directors of Jignesh Shah-controlled FTIL and NSEL, along with the defaulting entities, of cheating and criminal conspiracy, forgery and criminal breach of trust.
Last month, Sinha, in his affidavit, alleged that Jai Shrivastava, a director of Mohan India, which owes R575 crore to NSEL, told him that he had given Mukherjee R35 crore part in cash and part by cheque.
Sinha also alleged that Mukherjee used high-end cars like Bentley, Porsche, etc, and stayed at Hotel Radisson Blue, which was owned by Mohan India/Mera Baba Group, during his visits to Delhi.
These were sponspored by Shrivastava, alleged Sinha, further stating that Mukherjee showed his wrist watch costing R2.5 lakh to another NSEL staffer in Delhi. Sinha has blamed the business development team headed by Amit Mukherjee for introducing buyers with bad credentials and not informing the management about possible diversion of funds by the buyers. If the buyers are investing funds into real estate, they should know it from the local sources immediately, he said.
Meanwhile, sources add that Sinha would be presenting himself before the EOW on Thursday after the police issued summons to him along with all those named in the FIR under section 160 of CrPC (Code Of Criminal Procedure).
On Tuesday, Jignesh Shah, along with three other directors Joseph Massey, Dewang Neralla and Shreekant Javalgekar presented themselves before the police in response to the summons. EOW registered a FIR on September 30 after conducting raids in 184 locations across 53 cities spanning 16 states.
ED steps in
Suspecting large-scale money laundering in NSEL's settlement crisis, the ED has sought details of the case from Mumbai Police, indicating that the central agency would also initiate a probe into it soon, a police official said.
ED officials have asked us in writing to provide them a brief about the NSEL scam. We will soon send them the details," an official of Economic Offence Wing (EOW) of Mumbai police said.