After three letters from the whistleblower, SEBI constituted an expert committee under the guidance of its technical advisory committee.
A timeline on how the NSE co-location scam was exposed, the involvement of Chitra Ramakrishna and the ‘Himalayan Yogi’
- Last Update:March 07, 2022, 2:29 PM IST
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NSE Scam: CBI arrested on Sunday Chitra Ramakrishna, former CEO and MD of National Stock Exchange (NSE), in a case of exchange manipulation. This is the second high-profile arrest in the case in which the agency had last month arrested Anand Subramaniam, a former group operating officer of the NSE and Ramakrishna’s deputy and confidante.
“Ramakrishna has been arrested after interrogation and will be produced in a competent court on Monday,” a CBI official said. The agency had last month questioned Ramakrishna along with Subramaniam and former NSE CEO Ravi Narayan.
The CBI action comes in the wake of allegations against Ramakrishna that she was sharing confidential information with a “Himalayan yogi” and had appointed Subramaniam in violation of rules.
His anticipatory bail plea was rejected on Saturday by a special CBI court, he said. Officials said the CBI, which had been probing the co-location scam against a Delhi-based stock broker since 2018, swung into action after a Sebi report showed alleged abuse of power by the then top NSE officials. I.
A timeline on how the NSE co-location scam was unearthed, the involvement of Chitra Ramakrishna and the ‘Himalayan Yogi’
- In 2014-15, a whistleblower had complained to SEBI that some brokers had misused the co-location facility in connivance with some top NSE officials. It is alleged that OPG Securities was granted improper access between 2012 and 2014 which enabled it to first log into the secondary server and obtain data before others in the co-location facility.
- On 2 December 2016, NSE’s founding member Chitra Ramakrishna resigned as MD after spending 23 years with the stock exchange.
- After three letters from the whistleblower, SEBI constituted an expert committee under the guidance of its technical advisory committee.
The Expert Committee observed that there was potential for manipulation and market abuse in the architecture of NSE with respect to the dissemination of tick-by-tick (TBT) data through Transmission Control Protocol/Internet Protocol (TCP/IP).
– found that preference was given to stock brokers
- When it was first exposed, the NSE management took a stern approach, filing a Rs 100 crore defamation suit against the media outlet for doing so.
- The matter reached the Bombay High Court. This took a toll on NSE and dismissed its suit. In addition, NSE was asked to pay Rs 50 lakh as fine.
- In 2016, SEBI asked NSE to conduct a forensic audit of its systems and deposit the entire revenue from its co-location facilities into an escrow account.
- Deloitte was assigned the task of conducting a forensic audit of NSE’s systems.
- On June 21, 2017, dissatisfied with Deloitte Touche Tohmatsu repost, SEBI says it will recruit its own forensic auditor to investigate the scam.
- June 21, 2018, SEBI says it has initiated enforcement action against entities involved in the case
- In 2019, SEBI passed its order on the issue, asking NSE to pay Rs 625 crore along with interest of 12 per cent and barred NSE from raising money from the stock market for six months.
- Also, SEBI directed OPG Securities and its directors to set aside undue gains of Rs 15.7 crore with effect from April 7, 2014, with 12 per cent interest.
- Ravi Narayan and Chitra Ramakrishna, who were at the helm of affairs during the issue, were asked to withdraw 25 per cent of their salaries during a specified period and penal orders were also passed against others who gambled the system. Was.
- On July 4, 2019, SEBI issued show cause notices to several entities involved in the scam, Ravi Narayan and Ramakrishna, former MDs of NSE, the exchange and several of its top officials (ex and serving).
- In February 2022, the regulator once again fined Ramakrishna and Narayan for corporate governance lapses in the appointment of NSE’s group operating officer, Anand Subramaniam. Subramaniam was arrested by the CBI last month.
- According to the CBI, between 2010 and 2014, Gupta allegedly “misused” the NSE server architecture in a criminal conspiracy with “unknown officials” of the exchange.
- Last month, a CBI team visited the SEBI office in Mumbai and collected documents related to the case in which it has already booked Sanjay Gupta, owner and promoter of Delhi-based OPG Securities Pvt Ltd, and others.
- On February 18, 2022, the CBI issued a lookout circular against Chitra Ramakrishna, former CEO Ravi Narayan and former COO Anand Subramaniam. Anand Subramaniam was arrested by the CBI last month from Chennai in the wake of the latest facts emerging in the NSE co-location case.
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