NSEL crisis: Shah says he is a victim of 'management fraud'
Financial Technologies India (FTIL) chairman and CEO Jignesh Shah has said that he is a victim of management fraud at beleaguered bourse National Spot Exchange Ltd (NSEL) and sought support from shareholders and the government to tide over this bad phase.
Addressing the company's annual general meeting (AGM) on Wednesday amid heavy police bandobast due to protesting investors, Mr Shah said his reputation has been hit and called on shareholders not to judge the performance of FTIL by its subsidiary, NSEL.
NSEL is facing problems in settling Rs 5,600 crore due to 13,000 investors after shutting trading operations in July. It has already defaulted on six weekly payments.
"We are pained that because of NSEL, market has to suffer...Please understand that this company should not be judged by NSEL. That is my humble request. Please don't take away credit of the institution what we have built," he said.
He said it would be "desirable" if he can get any support from the government and called on shareholders to "stand and commit ourselves to this painful episode".
Mr Shah also stated that he would have to stand by small investors at NSEL to regain his reputation and will leave "no stone unturned" to get back to normalcy.
"The biggest loser is reputation," he told reporters.
"I was enjoying market value and reputation at the highest value. You judge by yourself rather than me justifying it."
Mr Shah said he is in talks with the investors' forum to resolve NSEL's payment issue.
"We have to focus for a really long time," he said when asked what deadline he has set to tide over this phase.
He told the shareholders he was the victim of "management fraud" at NSEL.
Ex-NSEL CEO Anjani Sinha, in an affidavit filed in a Mumbai court, had blamed the entire former NSEL senior management, including himself, for the payment crisis.
Stressing that FTIL's profit hasn't been affected by the NSEL fiasco, Mr Shah said, "People say 50 per cent. But it was not." He also said that the facts would become clearer after the earnings report for fiscal year 2012-13 is revised.
Mr Shah said FTIL's statutory auditor Deloitte, Haskins & Sells will recast the financial statement based on new inputs from NSEL. Deloitte raised doubts about FTIL's accounts and withdrew its report certifying them.
Some investors staged protests outside the AGM venue, wearing black badges and holding placards with slogans such as 'where is our money, Jigesh bhai, open your eyes. We want our money back, don't take our hard-earned money'.
