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A special MPID (Maharashtra Protection of Interest of Depositors Act) court would hear on Tuesday the anticipatory bail application of Joseph Massey, a former Non-Executive Director of NSEL, in connection with the ₹5,600-crore NSEL payment default that shook the nation in 2013.
While the Economic Offences Wing (EOW) of Mumbai police is likely to challenge his anticipatory bail application, National Spot Exchange Ltd (NSEL), which sees EOW Summons to Massey as highly motivated, is expected to back the former NSEL Director.
Massey had, on Friday, approached the special MPID court to seek anticipatory bail, after the EOW of Mumbai Police summoned him for interrogation of his alleged role in the NSEL payment crisis.
Mumbai Police is keen to interrogate Massey in view of new documents and evidences surfaced during the ongoing investigation.
It may be recalled that Mumbai Police had recently arrested former NSEL Chief Financial Officer Shashidhar Kotian, who has been remanded to the police custody by a court till January 28.
TARGETED
NSEL on Saturday, said that Massey and some former employees are being targeted by the Mumbai Police. Describing the EOW's move as highly motivated, NSEL said in a statement: ''This is especially when all the agencies, Central Bureau of Investigation (CBI), Enforcement Directorate (ED) and EOW-Mumbai Police, have already filed their charge-sheets on NSEL and 63 moons. It is also to be noted that Massey is made a witness in its charge-sheet by CBI."
NSEL has expressed disappointment over Mumbai police EOW’s latest action as it came at a time when money trail has been traced to the 17 defaulters "and the entire liability for recovery rests with these defaulters" and a statement pertaining to the same has also been made by former Minister of State for Finance Arjun Ram Meghwal in the floor of the Parliament.
‘’The action from EOW is nothing but an attempt under pressure exerted by the brokers to divert attention away from them whofeel the heat of prosecution by Securities and Exchange Board of India (SEBI) and various investigating agencies”, NSEL statement said.
SEBI had issued show cause notice to these brokers under the SEBI (Intermediaries) Regulations, 2008. Based on the same, the EOW had filed a FIR against these brokers/members on September 28, 2018, in relation to the transactions which they had entered into on NSEL platform. Also, the SFIO has in its report identified the misdeeds of the brokers and recommended to SEBI that strict action be taken such as declaring the brokers as ‘not fit and proper’.
In its investigation, the SFIO had found many violations by brokers/members including mis-selling of products, KYC manipulations, client code modifications and infusion of black money and benami funds through their respective Non-Banking Finance Companies on NSEL platform.
On January 15 this year, the Corporate Affairs Ministry directed the Serious Fraud Investigation Office (SFIO) to prosecute all those involved in the NSEL scam and recommended strict actions by SEBI against brokers including declaring them 'not fit and proper'.
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