|
|
|
Madras HC issues notice to SEBI, MCA, ED in NSE co-location case
|
|
|
|
Top Stories |
|
|
|
|
SME Times News Bureau | 10 Oct, 2019
The Madras High Court has
admitted a Public Interest Litigation (PIL) filed by the Chennai
Financial Markets and Accountability (CFMA) in the National Stock
Exchange (NSE) co-location case and issued notices to the SEBI, the
Ministry of Corporate Affairs (MCA), the CBI, Enforcement Directorate
(ED) and the NSE.
It has also issued notices to the Serious Fraud
Investigation Office (SFIO) and the Financial Intelligence Unit (FIU).
The High Court has directed the noticees to respond on November 11.
The
petition stated that NSE has violated the fundamental objective inside
the trading and thereby in the process and given illegal preferential
access to certain trade members to access NSE trade data at the cost of
entire securities market.
According to the PIL, SEBI has not
taken any effective steps to unearth the scam, "one of the biggest
financial frauds ever taken place".
The order copy dated
September 27 also said that the PIL brought to the knowledge of the
court that the third respondent, the Central Bureau of Investigation
(CBI) filed the first investigation report bearing "No.RC AC1 2018
A0011" on 28.05.2018, in relation to NSE co-location Scam and there
appears to be a slow progress in the said investigation.
"We
state that the NSE Colo Scam have tarnished the reputation of a major
market infrastructure institution and severely challenged the integrity
of the securities market. Millions of investors, mostly retail
investors, would have suffered huge losses due to relatively delayed
dissemination of order-book data to them and in the absence of the
awareness that some select TM's were able to access the order book data
ahead of them," the PIL said.
It further said that the terms of
reference (TOR) for SEBI approved auditor and NSE approved internal
auditor for the data centre and also the broker "OPG: must be
investigated to see if they were adequate to unearth the illegalities
and complicity and whether cognizance of all the findings of these
auditors was taken by the authorities.
"Surprisingly this was not
done by the 1st respondent SEBI at all," it said. It also noted a slow
progress in the CBI investigation into NSE co-location scam.
The
PIL further said: "It is shocking that the 1st Respondent (SEBI) had
absolved the 7th respondent NSE and its officials of all allegations
under the SEBI (Prohibition of Fraudulent and Unfair Trade Practices
relating to the Securities Market) Regulations, 2003 ("PFUTP
Regulations") in the relevant SCNs."
"It is submitted that when
there is a serious fraud and misdemeanors committed by the top officials
of the NSE who were acting hand in glove with the TMs towards
manipulating the market and providing unfair trade access, NSE cannot be
allowed to go scot free."
The co-location case dates back to
2015 when a whistleblower wrote to SEBI alleging that NSE was giving a
few high-frequency traders and brokers preferential access to its
trading platform which benefited both the parties at the cost of others.
The
whistleblower had alleged that some trading member of NSE in collusion
of employees or management of the exchange including preferential
treatment to certain trading members to obtain faster access to market
trade data.
|
|
|
|
|
|
|
|
|
|
|
|
|
Customs Exchange Rates |
Currency |
Import |
Export |
US Dollar
|
66.20
|
64.50 |
UK Pound
|
87.50
|
84.65 |
Euro
|
78.25
|
75.65 |
Japanese
Yen |
58.85 |
56.85 |
As on 13 Aug, 2022 |
|
|
Daily Poll |
|
|
PM Modi's recent US visit to redefine India-US bilateral relations |
|
|
|
|
|
Commented Stories |
|
|
|
|
|
|
|
|