NSEL crisis: Spot exchange acting as NBFC without RBI nod, warned auditor in 2011

Nov 14 2013, 09:46 IST
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NSEL was taking higher risk of credit default as it does not hold any security or line, says an audit. NSEL was taking higher risk of credit default as it does not hold any security or line, says an audit.
SummaryManagement and the board of NSEL ignored an internal audit report prepared way back in 2011.

for issuing the SCN while ignoring some of the factual observations made in the notice. The regulator gave all the entities an opportunity for a personal hearing on Tuesday, wherein it is believed that they also challenged some of the findings of the forensic audit report prepared by Grant Thornton.

Another defaulter questioned

The Mumbai police have questioned Balbir Singh, promoter of LOIL group of companies, which, according to NSEL, owes more than R750 crore to the spot bourse. According to a senior official from EOW, Singh was questioned and his books of accounts examined. The police have already arrested the directors of two other defaulting firms — NK Proteins and Lotus Refineries. According to NSEL statements, LOIL Overseas Foods owed R93 crore, LOIL Health Foods R298 crore and LOIL Continental Foods R366 crore to the exchange. Cops have also identified nearly 166 properties of defaulters to be attached in the case. Around 100 properties have already been attached. Around 12 properties across cities like Mumbai, Ahmedabad and Delhi belonging to

NK Proteins — the largest defaulter — have also been attached. FE Bureau

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