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The Central Bureau of Investigation (CBI) has named National Stock Exchange’s former managing director and chief executive officer Chitra Ramkrishna and ex-group operating officer Anand Subramanian, along with some brokerage firms, as “accused” in the co-location case.
The central agency on Thursday filed its first prosecution complaint, popularly known as charge sheet, at the special CBI court in Delhi, according to people in the know.
The court would take cognisance of the complaint after reviewing the voluminous documents of evidence submitted by the agency.
Both Ramkrishna, who quit as MD and CEO in 2016, and Subramanian were in the probe agency’s radar, amid revelations of irregularities at the country’s largest stock exchange NSE. Both were in judicial custody following their arrest on March 6 and February 25, respectively.
Sources say Ramkrishna is being charged for abusing her power and official position in some key decisions and also for governance lapses in the appointment of Subramanian as chief strategic advisor. He was later elevated as GOO with a pay cheque of Rs 4.21 crore a year.
The CBI is learnt to have recorded Ramkrishna and Subramanian’s statements during the interrogation. Sources say she did not reveal the identity of the elusive Himalayan Yogi who was advising and guiding her through emails.
Based on its investigation, the CBI believes that while Subramanian may have created the email ID of the Yogi, he was not the one operating it. However, it was not clear whether the CBI had reached any conclusion on the identity of the Yogi.
This is the first charge sheet in the case, which has been filed before the 60-day deadline from the date of arrest ends. Additional or supplementary charge sheets are expected in a month or two, a source indicated.
The central agency had arrested Subramanian for his role in giving unfair advantage to certain brokers.
The CBI is learnt to have found that the emails were sent by Subramanian contrary to his claim at the time of interrogation that he wasn’t handling the email directly. The agency has even sought assistance from technology giant Microsoft to track the details of the said ID.
The investigative agency will likely question more officials, including those at NSE and capital market regulator Securities and Exchange Board of India (Sebi). The Sebi had provided over 2,000 emails to the CBI in connection with the case. The CBI and the Union finance ministry had questioned why the NSE and Sebi officials had not flagged the issue as soon they received a forensic audit report in 2018. According to sources, the agency suspects the involvement of some Sebi officials in the matter. During investigations, Ramkrishna admitted that she used to take spiritual guidance from the Yogi, but maintained that all operational decisions at NSE were her own.
Notably, the arrests were made four years after the FIR for the co-location scam was registered in May 2018. The CBI is probing the alleged improper dissemination of information from the computer servers of the market exchanges to stock brokers.
In the co-location facility offered by the NSE, brokers could place their servers on the stock exchange premises giving them faster access to the markets. It is alleged that some brokers in connivance with insiders abused the algorithm and the co-location facility to make windfall profits.
Earlier this month, Enforcement Directorate (ED) sleuths carried out extensive searches at about nine premises in Delhi and Gurugram, as they suspected those brokers had made illicit gains by getting an unfair advantage over the rest of the market.
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