On Wednesday, the Enforcement Directorate (ED) shared that they have submitted a new chargesheet in the case about the National Spot Exchange Limited (NSEL) and money laundering. This report was filed in a special court in Mumbai on January 28. It includes accusations against 19 broking companies and their leaders for supposedly working together with NSEL officials to mislead investors into trading on their platform, as stated by the ED.
The court acknowledged the chargesheet on February 3. Previously, the ED filed six other chargesheets against 94 people and took control of assets worth Rs 3,288 crore during an ongoing investigation.
Investigations showed that these broking companies, after becoming registered with NSEL, tricked their clients by providing false promises about the exchange. They encouraged illegal trading pairs that were not allowed. Together with NSEL, these broking firms created a system that didn’t require proper collection of warehouse receipts or physical commodities, all while knowing they were misleading clients.
Through a dishonest plan, the broking companies attracted investors with promises of big returns, leading to a scheme that cheated many. The earnings from these illegal activities were then used to support other business efforts, disguising them as clean money.
The ED began their investigation along with the Economic Offences Wing of the Mumbai Police in 2013 under the Prevention of Money Laundering Act (PMLA). They accused the involved individuals of devising a criminal plan to trick investors and made fake documents like bogus warehouse receipts, leading to a criminal breach of trust for about 13,000 investors, totalling Rs 5,600 crore.
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