Anjani Sinha after being arrested in Mumbai on Thursday. (PTI)
Mumbai, Oct 17: Anjani Sinha, the former managing director and chief executive of National Spot Exchange Ltd (NSEL), was arrested today by the economic offences wing (EOW) of Mumbai Police for his alleged role in the Rs 5,500- crore payment crisis that rocked the bourse.
This is the third arrest of a senior NSEL official by the EOW. Police had arrested Amit Mukherjee, a former assistant vice-president of the exchange, on October 9, while Jay Bahukhundi, another former assistant vice-president, was arrested the following day.
Sinha was arrested in the evening today after over seven hours of interrogation. He is expected to be produced in the Metropolitan Court tomorrow. Sinha was supposed to appear before the EOW on Wednesday but had submitted an application stating that he would come today.
He was grilled by the Enforcement Directorate (ED). Earlier, the ED had registered a preliminary inquiry report under the Prevention of Money Laundering Act, suspecting large-scale money laundering in the crippled exchange.
It is learnt that the EOW may invoke the Maharashtra Protection of Interest of Depositors Act against the accused. If this is done, the police can attach the properties of the accused.
Sources felt that following such arrests, the authorities should now focus on recovering the money that investors have lost.
Reacting to the development, Sharad Kumar Saraf, chairman of the NSEL Investors Forum, said while it welcomed the arrest of Anjani Sinha, the development could provide valuable information on the money trail and the transactions conducted by the exchange.
Sinha, who filed an affidavit before a city court a few days ago, had also blamed himself for the crisis. He admitted to submitting a “wrong stock statement” to the NSEL board and the regulator, the Forward Market Commission, based on the report by the warehousing division.
Taking the blame for not informing the board about the increasing exposure and risk of widespread defaults, Sinha said the management allowed the exchange to function and did not stop trading due to fear of widespread defaults.
Sinha is believed to have recanted on his affidavit, but this could not be independently confirmed.