CBI arrests Jignesh Shah

The Central Bureau of Investigation on Tuesday arrested Jignesh Shah, promoter of FTIL and commodity bourse MCX, in a case pertaining to fraudulence and other regulatory violations. The agency also carried out raids at nine places in Mumbai, including Shah’s residence and office premises.

The case was registered under Section 120B of the Indian Penal Code, read with Section 420 of IPC, and Section 13(2) read with 13(1)(d) of the Prevention of Corruption Act, 1988, a CBI press release said. Other accused include four former officials of the Securities & Exchange Bureau of India or Sebi. They face the charges of connivance with Mumbai-based MCX-SX. They have been accused of fraudulently allowing renewal of recognition of Shah-promoted entities to conduct trade in currency derivatives in 2009-10.

The CBI has further alleged that the entities dishonestly entered into a buyback arrangement with some financial institutions in violation of the Securities Contract Regulation Act, 1956, and other rules and regulations. The agency has also accused them of deliberately suppressing this material fact while applying for extension of its recognition to operate in currency derivative.