The Economic Offences Wing (EOW) of Mumbai police on Thursday arrested Jai Bhaukhandi, Assistant Vice-President in charge of Warehousing at National Spot Exchange which is struggling to settle trade worth Rs 5,600 crore entered on its platform.

Bhaukhandi was arrested for alleged violation of know-your-client (KYC) norms. Sources said that Bhaukhandi is also accused of making false stock statements.

According to former Managing Director Anjani Sinha’s affidavit, Bhaukhandi would visit the sellers’ location, verify stocks and depute warehouse supervisors and security guards before the launch of each contract. Based on his confirmation, the contact would be launched by the Exchange. It finally turned out that Bhaukhandi’s team did not have any control on the stock. Sources revealed that Bhaukhandi owns a flat in Thane in his wife's name while another flat in Noida, Delhi is registered in his name. He also owns two vehicles — Maruti Wagon-R and Mahindra XUV — together worth around Rs 23 lakh. He was arrested at around 3.30 pm on Thursday, EOW sources said, adding, “Bhaukhandi will be presented before the Esplanade Court on Friday where his custody will be sought.” Amit Mukherjee, who was arrested by EOW on Wednesday, was presented before the Esplanade court on Thursday. On EOW contention that it needed to interrogate Mukherjee to get to the bottom of the NSEL payment default issue, the court granted custody of Mukherjee till October 18.

Sinha does not show up

Sinha who was supposed to present himself at EOW office at 5 p.m. today did not turn up, sources said, adding that a non-bailable warrant will be issued if Sinha continues to evade.

Sinha has already submitted a detailed affidavit regarding the case to EOW officials. He has named the NSEL officials who were involved in the scam.

‘SEBI alive to safeguarding investor interests’

The Securities and Exchange Board of India has promised swift and timely action to protect the interests of investors engaged in platforms recognised by the capital market regulator.

This assurance came from SEBI Chairman U. K. Sinha on the sidelines of a capital market event organised by PHDCCI here on Thursday.

He was responding to a query from mediapersons on the ongoing board level developments at the MCXSX, the youngest equity bourse of the country.

“SEBI is very alert that interest of investors, who are working on the platforms recognised by us, is protected and not compromised.

Whatever is required for this purpose, we are going to act,” Sinha said. Sinha declined to get into specifics of what regulatory action could be expected from SEBI on the Financial Technologies-MCX matter.

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