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Deloitte Haskins resigns as statutory auditor of Jignesh Shah-led FTIL

11 June, 2014

Deloitte Haskins and Sells LLP has decided to step down as the statutory auditor of Blackstone-backed Financial Technologies India Ltd (FTIL), which is embroiled in a Rs 5,574 crore payment crisis, with immediate effect, according to a stock market disclosure.

The global auditing agency Deloitte has also expressed its inability to offer itself for reappointment as the auditors of the company at the forthcoming annual general meeting, FTIL said in a filing to the stock exchanges.

The audit of FTIL’s stand-alone financials for the fiscal ended on March 31, 2014 was completed by Deloitte, which is also the statutory auditor of Multi Commodity Exchange of India Ltd (MCX). FTIL owns 26 per cent equity stake in MCX.

For the quarter ended March 31, 2014, FTIL posted a net loss of Rs 371 crore against a net profit of Rs 87.8 crore in the same period a year ago. FTIL owns 99.99 per cent equity stake in National Spot Exchange (NSEL).

NSEL was hit by a payment crisis last year even though it faced a show cause notice two years ago on allegations that the spread contracts it ran violated forward contract law.

Over the last few months, FTIL as a group came under the scanner of various regulatory bodies, including securities market regulator SEBI and Forward Markets Commission (FMC). Both FTIL as a company and Shah as an individual were deemed to be unfit to run any exchange in the country.

Last month, Jignesh Shah, the 46-year-old promoter of FTIL and MCX, along with Shreekant Javalgekar, former MD and CEO of MCX, was arrested by the Economic Offences Wing (EOW) of Mumbai Police, in relation to their alleged involvement in NSEL scam.

At present, FTIL is in the process of selling off its entire equity holding in MCX, after the commodity watchdog FMC’s direction on 17 December. The directive by FMC followed an inquiry into payments crisis at NSEL.

FTIL counts Blackstone, Norwegian sovereign wealth fund Government Pension Fund Global and Citigroup Venture Capital International as shareholders. MCX has shareholders such as Intel Capital and Blackstone.

(Edited by Joby Puthuparampil Johnson)


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Deloitte Haskins resigns as statutory auditor of Jignesh Shah-led FTIL

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