Business Standard is doing some awesome research about NSEL.This is real journalism. Now, they find NSEL’s jeera warehouse with a notice saying the goods are pledged with ICICI Bank!
The crisis-ridden NSEL has two warehouses at Unjha for jeera. A visit to these warehouses at Shivganga Area, on the Unjha-Unava Highway, near Unjha revealed that the stock was already pledged to ICICI Bank Ltd.
Sebi has received complaints that these brokers were offering returns of up to 15 per cent to their clients, by asking them to place one-day buy orders for various commodities on NSEL platform, followed by immediate sell orders to be executed in next few days.
Besides, many brokers could also have been taking proprietary positions on NSEL with their own or clients’ money as a hedging instrument in the wake of dwindling returns in the capital markets, sources said.
The question to ask is: Did the brokers get out of their proprietary positions while leaving their clients holding the bag? If so, they face serious action if they can’t prove they tried to warn each and every such customer.
And FE says that MCX is being ring-fenced by the regulator, FMC, to ensure funds don’t go to NSEL.
FMC chairman Ramesh Abhishek told FE that MCX has been directed not to give any loans, advances or make any financial commitment to any corporate or non-corporate entity without FMC’s prior approval, excepting transactions in the normal course of business. “This financial ring-fencing has been done to instil confidence among investors,” Abhishek said.
Oh, we’re just getting started. There’s lots and lots and lots more to come.