With a solution of 5 months old Rs 5,600 crore NSEL crisis remains elusive, the Reserve Bank has said it is not advisable to let only one group of Shareholders to be control operation of any exchanges.
“The (NSEL) incident has been emphasized the necessity to ensure that no shareholder or group of holders permitted to control operation of the exchange control or exercise management control,” RBI said in its biannual Financial Stability Report released yesterday.
NSEL scam, which surrounds the companies led by Jignesh Shah, “has exposed certain systemic concerns ownership and arrangements of governance accordingly in trade and stock ownership of exchanges and existing technology platforms.”
The RBI view comes within a fortnight of the industry regulator FMC said in a report that states that the developer and promoter Shah of Financial Technologies Company is not eligible to execute the exchange cripple a group contested by the order in the Bombay High Court .
The RBI report says that NSEL scam emphasized the loophole in regulating the commodity spot exchanges and added that “we need to deal comprehensively with the problems in the spot markets for commodities.”
It is noteworthy that the Government will on July 30 ordered the closure of the following irregularities NSEL, that later showed that spot exchange rate was a whopping Rs 5,600 crore in dues to thousands of investors and dozens of brokers / intermediaries.
On December 18, a serious accusation the promoters of NSEL, the market regulator FMC commodity, said Shah and his firm Financial Technologies were not “fit and proper” to execute any exchange in the country and accused him of be the “highest beneficiary” in the NSEL scam.
Reported News Source: PTI Business Standard