Jignesh Shah Arrested In Rs 5,600 Crore NSEL Scam Case

Mumbai: On Tuesday, the Enforcement Directorate (ED) arrested Jignesh Shah, the key man behind the Financial Technologies India (FTIL) group that promoted scam-tainted National Stock Exchange Limited (NSEL), for suspected laundering.

Shah’s arrest in the Rs 5,600-crore NSEL scam came after the investigating agency stumbled upon some new leads relating to the case, sources said. Earlier in the day, ED officials had called Shah for questioning. They then arrested him after he refused to cooperate with the investigators.

ED sources said Shah could not explain the transactions between FTIL, Indian Bullion Market Association, NSEL and other entities. Sources in the agency said they feel these were “paper transactions” and Shah was bound to explain these transactions. This led to his arrest and the agency feels that there is a “strong case” of money laundering against him.

Shah was earlier arrested in May 2014 by the Economic Offences Wing (EOW) of the city’s police in the same case. He was out on bail. In the NSEL scam, the spot exchange for commodities trading had launched several investment products which helped a large number of investors make easy money. However, ED and some other investigating agencies believe that there were several bogus investors and some of the large brokers on NSEL had a hand in creating such bogus investors to generate illegal profits.

In August 2013, after the government suspected illegal and unauthorized trading on NSEL, it asked the bourse to close all such trading with immediate effect. This led to a huge payment crisis and several people who had lent money to brokers for hefty interest income were left high and dry.