Tuesday, 18 April 2017

MCX board likely to reopen cases of siphoning of funds by employees

India's largest commodity bourse, Multi Commodity Exchange (MCX) is planning to open up its old, buried cases. The board - led by new chairman Saurabh Chandra - is mulling opening cases where its employees were involved and named in the forscenic audit report.

India's largest commodity bourse, Multi Commodity Exchange (MCX) is planning to reopen old cases related to allegations of siphoning of funds in connivance with employees of the exchange, a source aware of the development told Moneycontrol.

The board - led by new chairman Saurabh Chandra - is mulling reviewing cases where its employees were named in the forscenic audit report by PricewaterhouseCoopers (PwC).

“It appears that the board has asked the management to reopen the cases and help investigation agencies," the source said.

PricewaterhouseCoopers (PwC) had submitted an audit report on the case, which mentions incidences of siphoning of money and misgovernance in the exchange. The report also mention names of MCX employees involved in the dubious transactions.

In 2015, Ketan Shah, a shareholder in MCX and an investor in the products traded on the scam-tainted National Spot Exchange (NSEL), had filed complaint alleging that the MCX management and promoters had siphoned funds from MCX.

The MIDC police station had submitted its closure report on the case.

Shah has been arguing for a reopening of the case by the Metropolitan Magistrate's Court. The Metropolitan Magistrate's Court today ruled that MCX cannot intervene in the matter, but Shah could continue with his argument.


"Exchange may even open the case of Sunil Khairnar in which an excessive amount was paid in the name of some random research papers," said the source.

In the FTIL case, Khairnar had received about Rs 17 crore in donations from MCX in name of allegedly bogus research papers, but no investigation was initiated.

The Income-Tax Department has come across transactions money received as donation was routed back to the erstwhile promoters of MCX.

In 2015, the I-T had sent a notice to MCX on this issue.
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