NSE’s current management is now in the dock over a first information report (FIR) filed by the Hyderabad police in the default case by Mumbai-based Anugrah stock Broking and alleged fraud by Teji Mandi Analytics.
The FIR has been filed against NSE, its current MD and CEO Vikram Limaye, its Chief Regulatory Officer Priya Subbaraman, promoters of Anugrah and Teji Mandi, Edelweiss Custodian Services and CDSL mainly for delayed action that caused investors to lose huge money. Anugrah was the second big fraud that came to light after one of the largest retail brokers Karvy, that was seen to have diverted client shares for the company’s loans.
‘Failed to act’
In the case of Anugrah, the FIR alleges that in 2017 and 2018 itself the NSE and CDSL were aware of a shortfall of funds in the account to Anugrah to the tune of ₹112 crore and they failed to take action against the broker even in 2020. The FIR has cited a 2019 SEBI report and a 2021 order of the regulator that highlighted these points. The complainants have claimed that all the accused have deceived them with common intention and caused a loss of ₹1.87 crore. While the investors have filed their claim with NSE, after the exchange declared the broker as a defaulter, but there is no resolution on the matter, the FIR states. T Ravi Prakash, an investor from Hyderabad, had filed the FIR.
In May, SEBI imposed a fine of ₹90 lakh on Anugrah for misusing client funds and making incorrect reporting to stock exchanges. More than 70 investors have approached the Bombay High Court alleging that Anugrah had indulged in “illicit and unauthorised transactions”, causing them heavy financial losses. The regulator has failed to assess the illegal profits made by Anugrah or loss caused to investors, it was alleged.