Nsel Scam: 95% Of Small Investors Get Money Back

(This story originally appeared in on Mar 21, 2022)

MUMBAI: The city police, probing the Rs 5,400-crore National Spot Exchange Limited (NSEL) cheating case, have till date auctioned over a dozen properties of the accused and reimbursed Rs 731 crore to investors. Importantly, more than 95% of small investors, who had invested Rs 2-10 lakh, have been reimbursed full amounts, said a senior police officer.

Among over 13,000 investors, 6,445 depositors have been classified as small investors. “Till date, around 6,150 (small) investors have been paid full amounts. This is more than 50% of all investors,” said Niket Kaushik, joint commissioner of police, EOW. To ensure this, tremendous efforts have been put in by EOW officers to smoothen the legal process, added a senior officer: “Efforts are on to remit payouts to the remaining 5,977 eligible and entitled investors.”

The complainant in this case alleged that NSEL, a platform for forward trading in agri commodities, gave investors an impression that “goods were in warehouses, when none existed”. In 2014, the EOW distributed money to 608 investors (who had lost less than Rs 2 lakh each).

This was recovered from the accused’s bank accounts. An escrow account was also opened in which some of the accused had voluntarily deposited money. This disbursement was supervised by the Forward Markets Commission and later the competent authority (a deputy collector rank officer) was appointed to evaluate properties, conduct auctions and repay investors.