A Delhi court on Monday sent former MD & CEO of National Stock Exchange (NSE) Chitra Ramkrishna to seven-day CBI custody till March 14, in connection with the irregularities that took place at the exchange between 2010 to 2013, saying her custodial interrogation was required for “fair and proper” investigations.
CBI Special Judge Sanjeev Aggarwal said, “It appears that the custodial interrogation (of Ramkrishna) would be required to find out the detailed modus operandi adopted by her in conspiracy with the other co-accused persons including Anand Subramanian.” There was a need to dig out the voluminous digital evidence and find out the role of other players in this case of “swindling the institutional investors, foreign institutional investors and honest retail investors”, the judge observed.
CBI had told the court earlier that Ramkrishna was found evasive in his responses to the sleuths.
While expressing displeasure at the pace of the CBI probe — the agency has so far managed to arrest only two accused in last four years — the judge enquired about “other beneficiaries” and asked CBI why no arrests had been made of those who were at the helm of the exchange prior to 2013.
The CBI said it was working on the case and was now “ready to go ahead.”
The probe agency had sought her 14-day custodial interrogation of Chitra, who was arrested by the CBI on Sunday after her anticipatory bail application was dismissed by the court on Saturday.
However, senior counsel Trideep Pais, appearing for Chitra, opposed the CBI’s demand, saying that rather than being part of it, she “brought an end to the scam” when she took over the exchange. He argued that Chitra has already joined the CBI investigations and has also been confronted with co-accused Subramanian. “She has fully cooperated in the investigation and, therefore, no ground for police custody remand is made out,” he said.
The CBI alleged that Chitra was evasive and had continuously misguided the investigation officer by giving wrong statements. The accused in conspiracy with Subramanian influenced the NSE officials to facilitate him in having access to important decision making processes and shared sensitive information about financials, appraisals, increments and strategy with an unknown person, who is also referred to as “Siddha Purush” by Chitra.
The prove agency also claimed that Muralidharan Natarajan, the CTO of NSETECH (a subsidiary of NSE), was responsible for putting in place the co-location architecture at NSE and was reporting to Chitra. It is alleged that some brokers in connivance with insiders abused the algorithm and the co-location facility to make windfall profits. In the co-location facility offered by the NSE, brokers could place their servers within the stock exchange premises giving them faster access to the markets.
Investigations further revealed that that during 2013-16 after Chitra took over as MD & CEO of NSE, OPG Securities was allowed to connect to secondary server of the COLO-TBT Dissemination server for over 300 trading days causing it undue gain, it said.
The CBI had also quizzed another former NSE CEO Ravi Narain in connection with the alleged abuse of the co-location facility by an NSE stockbroker. An audit report had allegedly referred to Subramanian as a mysterious yogi, but this was dismissed by the Sebi in its report on February 11. In its order, the regulator had said Ramakrishna and Subramanian committed ‘financial misdeeds’, and identified serious governance lapses and misrepresentation of facts at NSE between 2013 and 2017.