The Economic Offences Wing (EOW) of Delhi Police has arrested former CEO of National Spot Exchange Ltd Anjani Sinha for allegedly duping the investors by assuring fixed returns on fictitious trading.

The accused has been identified as Anjani Sinha. Police said that he was arrested on Sunday from Mumbai.

According to Dr O P Mishra, the Joint Commissioner of Police, EOW, the complainants alleged that the brokerage firm M/s Integrated Commodity Trades Pvt Ltd, Barakhamba Road, Delhi, through its directors has cheated them by inducement and misrepresentation regarding commodity trading on the platform of National Spot Exchange Ltd (NSEL).

"The complainants were induced by the directors to invest in commodity market which is undertaken by them as trading and clearing member of NSEL, presenting it to be completely safe, as being regulated by the government authorities," said the Joint CP.

"Being the member of the exchange, the alleged broker was to ensure that at the time of issuing the delivery order, the seller of the commodity satisfies his clearing member that he owns and holds adequate stocks of the required commodity," he said.

"The trading cum clearing member has to ensure that the commodities purchased by the clients or investors through contracts were delivered to the NSEL certified warehouses. The warehouse receipts were to be delivered by the member to its clients at the time of the settlement of the contracts," said the Joint CP.

"The alleged broker in collusion and conspiracy with the exchange (NSEL) and the sellers (trading members) did not collect the delivery orders and the warehouse receipts whereas the transactions were done on behalf of the complainants," said the Joint CP.

"It was alleged that fictitious stocks were traded on the exchange as a result of which the settlement of contracts was not done on the day of maturity, causing loss to the complainants. The alleged broker had represented to the complainants that NSEL is a national level electronic, transparent and institutionalised spot market which provides counter party guarantee in respect of all trades and which was regulated by Forward Markets Commission (FMC)," said the Joint CP. 

"Complainants alleged Integrated Commodity Traders Pvt Ltd, NSEL, its CMD Jignesh Shah, CEO Anjani Sinha and others for cheating, criminal misappropriation and use of forged invoices. During investigation, it was found that the alleged persons represented to the complainants that their business method was unique and has all the approval of the Forward Markets Commission (FMC)," he said.

"The accused caused wrongful loss of Rs 7.5 crore to three victims through complainant company and misappropriated the funds for its own use. The NSEL has caused a gross total fraud of Rs 5,600 crore to 13,000 victims. The NSEL platform for spot trading was designed by the management of the exchange with assured return investment schemes. It was also evident that the officials of the NSEL were engaged in alluring and inducing the clients, brokers and public at large to invest in commodity market through NSEL being a fixed assured return platform," said the Joint CP.

"All the activities were illegal, unauthorised and nothing more than that a ponzi scheme in the form of money circulation scheme. During investigation, a team was sent to Mumbai and accused Sinha was arrested,” said the Joint CP.

"During interrogation, accused has disclosed that he used to report to Jignesh Shah who was the group MD and Chairman. Shah was very desperate to generate profit in the subsidiary companies. He devised introduction of new business concept in the NSEL even violating conditions of licence of NSEL given by Ministry of Consumer Affairs," he said.