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CBI arrests MD of OPG Securities in NSE co-location case

CBI arrests MD of OPG Securities in NSE co-location case


New Delhi, June 22

The CBI has arrested Sanjay Gupta, a Delhi-based broker and managing director of OPG Securities, in the NSE scam, four years after the agency registered an FIR against him for alleged preferential access to a market called co-location facility through multiple IDs and secondary servers. Had it. officials said on Wednesday.

The CBI has alleged that it had received information that Gupta along with some persons tried to destroy some evidence and also tried to influence SEBI officials probing the NSE co-location scam case.

He said the agency had summoned Gupta to its headquarters where he was questioned about these issues.

During interrogation, Gupta evaded and tried to mislead the probe, resulting in his arrest on Tuesday night, officials said.

He said Gupta had allegedly approached members of a syndicate to bribe SEBI officials on their behalf and influence the investigation. He said that the CBI is probing whether the bribe given to the syndicate members reached the officials of SEBI or not. Similar allegations were made in the CBI FIR lodged against Gupta in 2018.

In February this year, the agency swung into action after a shoddy report by SEBI, in which strict action was taken against the then NSE CEO and Managing Director Chitra Ramakrishna and Group Operating Officer Anand Subramaniam.

It is alleged that OPG Securities logged on to selected tick-by-tick servers of NSE continuously for four consecutive years on most of the trading days between 2010 and 2014 and also accessed servers with better hardware.

A tick is a minimal change in the price of a security. It is alleged that the tick-by-tick architecture used by the NSE was manipulated by the brokers to stay ahead of the peers in the trading hours.

Deloitte Touche Thamatsu, which conducted a forensic review of NSE’s co-location facility, found that OPG Securities was the first in majority of the cases during the trading sessions.

The CBI had earlier arrested Ramakrishna and Subramaniam, who were not named in the FIR, in connection with the case and both are in judicial custody since March.

The special court had repeatedly questioned the CBI about the action taken against Gupta and OPG Securities, the other accused named in the FIR.

The CBI has alleged that Gupta was one of the main beneficiaries of the co-location facility introduced by NSE, which helped him gain favorable access to the market at other brokers through multiple logins and access to secondary servers that allowed him to Gave significant time gains and as a result the profits of his company increased manifold in just two years.

In NSE, selected players in co-location scam had market price information before others as the stock market was using tick-by-tick techniques in algorithmic based trading and co-location services, which benefited Gupta.

He added that the feature allowed users to gain access to prices before others.

The investigation has so far revealed that during the period 2010-15 when Ramakrishna was managing the affairs of NSE, OPG Securities, one of the accused in the FIR, connected to the secondary POP server on 670 trading days in the futures and options segment. was. CBI has alleged.

Officials said investigations are underway into the alleged role of then senior NSE officials, who were looking for co-location, which is understood to have given some stockbrokers, including OPG Securities, “undue profit and wrongdoing” at the expense of others. benefit” was given. ,

Officials said facilitating co-location at NSE was a “major policy decision” in which the then MD and CEO and other senior officials would have played a “decisive role”.

Ramakrishna was appointed as Joint MD in 2009 and held the position till 31 March 2013 with the power of DMD. He was promoted as MD & CEO on April 1, 2013.

The agency has also alleged that Muraleedharan Natarajan, CTO of NSETech (a subsidiary of NSE), which was responsible for setting up the co-location architecture at NSE, was reporting directly to Ramakrishna, officials said. .

Ramakrishna, who replaced former CEO Ravi Narayan in 2013, appointed Subramaniam as his advisor, who was later promoted to Group Operations Officer (GOO) and received a rough pay check of Rs 4.21 crore annually. was happening.

The Securities and Exchange Board of India (SEBI) on February 11 had accused Ramakrishna and others of alleged governance lapses in the appointment of Subramaniam as chief strategic advisor and his re-designation as group operating officer and advisor to the MD.

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CBI arrests MD of OPG Securities in NSE co-location case

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