THE NSEL CRISIS WAS MISINTERPRETED &

MISUNDERSTOOD (PART-2)

ContentsIntroduction

Forward Markets Commission (FMC) was in the know of the NSEL Business

NSEL Took SUFFICIENT Measures soon after the Crisis

NSEL adhered to the Settlement Schedule

NSEL Board monitored the Business

FTIL’ s Limited does not benefit from NSEL

FTIL Stands by nsel in it’s time of crisis

IntroductionNSEL has neither borrowed nor lent money to any Trading Client

or Broker.

In the aftermath of the sudden stoppage of contracts, some of the trading clients were caught up in a liquidity trap.

That ultimately led to a payment problem.

FMC was in the know of the NSEL Business

The FMC was the designated agency in since 2011 to which the spot exchanges were to submit periodic information on all business undertaken.

NSEL submitted periodic reports to the Government and the FMC on every aspect of the business.

The FMC did not point out any irregularities in the same.

NSEL took sufficient Measures soon after the Crisis

Under the aegis of the FMC, NSEL had organized a joint meeting of all the stakeholders for their claims.

After due consultation, a payment schedule was prepared, which was prepared by the FMC.

NSEL adhered to the Settlement Schedule

Every effort was made by NSEL to implement the payment schedule that was drawn.

The Trading Clients were caught in a liquidity trap due to sudden stopping of the contracts based on the instruction of the Government.

Members tried to cover their exposure by migrating stocks and other collaterals which adversely affected the payment schedule.

NSEL Board monitored the Business

The FMC, since it began to seek information on spot exchanges was directly contacting the MD and CEO of NSEL on all aspects regarding information, clarifications, receiving responses, etc.

At no time until July 2013 did the FMC had give any indication of sudden stopping of the contracts.

Neither the FMC nor the Government had written to the Board of NSEL or the promoters about any deficiencies that it might have perceived in the functioning of NSEL.

FTIL’s limited does not benefit from NSEL

For FTIL, NSEL is just a subsidiary, exploring the opportunities in the spot market segment.

Investigation agencies have done a thorough search of the money trail, which was all traced to the defaulters and not even one rupee to the promoter.

The impression that FTIL has benefited from NSEL is totally misplaced and unfounded.

FTIL Stands by NSEL in it’s time of crisis

FTIL has provided a without prejudice loan of Rs. 179 crore to NSEL to pay their trading clients.

Brokers are yet to provide details on the disbursement of these monies to small traders since privity of contract was between Broker and Trader.