Venkat Chary blames former employees for NSEL crisis

Written by PTI | Mumbai | Updated: Mar 25 2014, 07:11am hrs
NSELVenkat R Chary debunked the media reports that said CBI may look into his role in the NSEL crisis. Reuters
Former bureaucrat Venkat R Chary, who served as non-executive chairman of commodity bourse Multi Commodity Exchange of India Ltd till August 2013, has put the blame for NSEL crisis at the former CEO and certain other employees of the spot exchange.

Chary, who has also served as chairman of commodities market regulator FMC (Forward Markets Commission) in the past, also said he fears a conspiracy behind his name being talked about by vested interests with regard to the NSEL crisis.

"There is a conspiracy against me ... I will take legal action against those responsible for tarnishing my image over the NSEL controversy, with which I have nothing to do," Chary said here.

Chary, who was on MCX's board for about a decade, also debunked the media reports that said CBI may look into his role in the NSEL matter. Chary claimed that he has discussed the matter with officials of CBI as well as the Economic Offence Wing of Mumbai Police and they have also denied any probe against him.

A major payment crisis involving Rs 5,600 crore broke out at National Spot Exchange (NSEL) last year.

Chary also defended Jignesh Shah, whose Financial Technologies group has been engulfed in a major row since NSEL crisis, and said that the NSEL employees, led by its ex-CEO Anjani Sinha were responsible for the whole crisis.

NSEL was set up by Financial Technologies group, which was also among the main erstwhile promoters of commodity bourse MCX and the MCX Stock Exchange.

However, the boards and governing structures of these two bourses have since been restructured.

Recently, Sebi declared Financial Technologies unfit to hold stake in MCX-SX among other entities.

"Anjani Sinha gave a confessional statement in writing, which has been notarised, and stated clearly what he did, what his key team members did and how they kept the management and the promoters in the dark.

"As I understand, under the Companies Act, non-executive directors are responsible for only those items that come before them. The MD and CEO is the executive of the company, which Sinha accepted that clearly and that he kept the entire board in the dark," Chary said.

When asked how promoters can wash hands of the moral and professional responsibilities for the NSEL crisis, Chary said that Jignesh Shah, like the rest of 70,000 shareholders of Financial Technologies, held no official positions at the now-crippled NSEL.

Chary also claimed that certain finance ministry officials had played an important role in favoring MCX's rival NCDEX.

"I wrote to consumer affairs ministry, finance ministry, the anti-corruption bureau of the CBI, and even the PMO, but no communication (has come) from them till date," Chary said.

When asked whether he sees any political conspiracy behind the alleged CBI case against him and another former bureaucrat CB Bhave, who served as Sebi chairman, Chary answered in the affirmative but did not elaborate.

"All I can say is that there is a conspiracy behind all this and I am not going to let it pass," he said.