In April 2001, the Calcutta Stock Exchange was engulfed in one of the country's worst-ever payment shortfall crises. Ten defaulting brokers or broking firms belonging to three major players failed to pay up Rs106.93 crores (Rs 1.07 billion) to the exchange against their obligations in three consecutive weekly settlements (numbers 148, 149 and 150).
The crisis depleted Rs 48 crores (Rs 480 million) out of CSE's Settlement Guarantee Fund and Rs 20 crores (Rs 200 million) from the general reserves. Parekh was blamed for it as it was widely suspected that he had used some CSE brokers as his front for deals in the information, communication and entertainment shares.
A senior broket at that time had said, the "exchnage was rocked by the crisis because it is the weakest part of the chain that is responsible for the capital market meltdown."
On November 29, absconding stockbroker Ashok Kumar Poddar, wanted in connection with the Rs 120 crore (Rs 1.2 billion) CSE scam was arrested.
Poddar was last of the three prime accused to have been arrested in the scam. Investigations were initiated following a first information report filed by CSE in September.
The other two prime accused Harish Chander Biyani and Dinesh Kumar Singhania, former president of CSE, were arrested on September 23 and November 20 respectively.
With Parekh's detention, the total number of arrests in the case has gone up to 18 and include former CEO and MD of Stock Holding Corporation of India B V Gaud, a senior vice-president of IndusInd Bank S N Paul and former MD of SREI Securities Dinesh Jain.
Dinesh Singhania, the absconding prime accused in the Rs 120-cr Calcutta Stock Exchange scam, was arrested when he stepped into his house at Salt Lake. Singhania was the CSE director when the scam was unearthed in March 2001. Some incriminating records were found during a police search of his house and office at India Exchange Place. Singhania had been absconding for over a month. Police said he was in various hideouts across the country, including Varanasi, Rajas-than and Mumbai. Singhania was president of the CSE twice. His alleged links with Ketan Parekh was mentioned in SEBI's interim report on share scams, submitted to the JPC in June 2001. So far, 16 people have been arrested. The other accused, Dinesh Dalmia and Ashok Poddar and his wife Prema Poddar, are at large. Deputy commissioner of police (DD) Soumen Mitra said, "Singhania along with the Poddars, who owed maximum to the exchange, was absconding since September 9 when we started investigation." Two of the arrested, Surendra Jain and Raj Kumar Agarwal, are in police custody, he said. Last week, police proclaimed Singhania, Poddar and Dalmia as offenders. Though a number of his associates, including his brother, uncle and nephew, had been arrested in the past few days, Singhania was evading arrest. He had even failed to respond to interrogation notices. Executive director of CSE, P.K. Sarkar, welcomed the arrest. However, he indicated it would not affect their move to arrive at a mutual understanding with Singhania. Last week, Singhania, Poddar and Harish Biyani, another accused, put forward a proposal to CSE through their lawyers that they wanted to pay Rs 10 crore as a one-time settlement against their dues of Rs 92 crore. The CSE management rejected the proposal.
Dinesh Singhania, the absconding prime accused in the Rs 120-cr Calcutta Stock Exchange scam, was arrested when he stepped into his house at Salt Lake. Singhania was the CSE director when the scam was unearthed in March 2001. Some incriminating records were found during a police search of his house and office at India Exchange Place. Singhania had been absconding for over a month. Police said he was in various hideouts across the country, including Varanasi, Rajas-than and Mumbai. Singhania was president of the CSE twice. His alleged links with Ketan Parekh was mentioned in SEBI's interim report on share scams, submitted to the JPC in June 2001. So far, 16 people have been arrested. The other accused, Dinesh Dalmia and Ashok Poddar and his wife Prema Poddar, are at large. Deputy commissioner of police (DD) Soumen Mitra said, "Singhania along with the Poddars, who owed maximum to the exchange, was absconding since September 9 when we started investigation." Two of the arrested, Surendra Jain and Raj Kumar Agarwal, are in police custody, he said. Last week, police proclaimed Singhania, Poddar and Dalmia as offenders. Though a number of his associates, including his brother, uncle and nephew, had been arrested in the past few days, Singhania was evading arrest. He had even failed to respond to interrogation notices. Executive director of CSE, P.K. Sarkar, welcomed the arrest. However, he indicated it would not affect their move to arrive at a mutual understanding with Singhania. Last week, Singhania, Poddar and Harish Biyani, another accused, put forward a proposal to CSE through their lawyers that they wanted to pay Rs 10 crore as a one-time settlement against their dues of Rs 92 crore. The CSE management rejected the proposal.
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