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National Spot Exchange: FMC may probe NK Proteins conflict of interest

Aug 13 2013, 13:29 IST
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SummaryMinistry of consumer affairs may ask the FMC to look into suspected conflict of interest.

The ministry of consumer affairs may ask the Forward Markets Commission (FMC) to look into suspected conflict of interest between NK Proteins and the National Spot Exchange Ltd (NSEL) following complaints.

Financial Technologies

The complaints by people, who claimed to have visited the warehouses of NK Proteins, also remained skeptical about the stock positions at NSEL godowns, especially of castor seed, castor oil and cotton wash oil, a senior government official said on Monday.

Last week, after the NSEL put out a list of members who were to pay total dues of nearly Rs 5,580 crore, it emerged that Nilesh Patel, the MD of Ahmedabad-based NK Proteins, which also has the second-highest liabilities, was the son-in-law of the exchange's chairman Shankarlal Guru.

NK Proteins owes Rs 929.90 crore and is one of the 13 processors that have offered to pay the combined dues of Rs 3,107 crore at 5% a week.

Multi Commodity Exchange of India Ltd (MCX)

While Patel couldn't be contacted immediately, an NSEL spokesperson rejected the charge of the conflict of interest. "Anybody who abides by the stipulated rules of the exchange could trade at NSEL.

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