NSE co-location case: CBI questions ex-group operating officer Anand Subramaniam

The Central Bureau of Investigation (CBI) has questioned National Stock Exchange's (NSE) former Group Operating Officer Anand Subramaniam in connection with the co-location case. The questioning took place in Chennai.

As per sources, documents from his residence were also seized.

Earlier, the investigating agency had met market regulator SEBI's officials last week in Mumbai in connection with former NSE chief Chitra Ramkrishna's case, top officials in the know of the matter told Business Today.

Officials added that the CBI wanted to understand more about the case and the recent order by SEBI, which revealed how Ramkrishna was sharing confidential data and information of the exchange with an unidentified person, who she claimed was a spiritual yogi dwelling in the Himalayas.

The CBI probe was initiated after the recent findings of the SEBI.

Ramkrishna is under investigation for allegedly sharing sensitive information about the exchange with a ‘yogi who lives in the Himalayas’. The CBI had in a statement mentioned that the alleged unfair practices occurred between 2010 and 2015.

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The CBI had last week questioned former NSE CEOs Ramkrishna and Ravi Narain in connection with ''fresh facts'' which surfaced in the damning report released by SEBI on February 11.

The SEBI order stated that it came across certain documentary evidence that showed that Ramkrishna had shared internal information including organizational structure, dividend scenario, financial results, human resources policy, and related issues, response to regulator, etc of NSE with an ‘unknown person’ through emails in the period from 2014 to 2016.

The market regulator charged Ramkrishna and others with alleged governance lapses in the appointment of Subramanian as the chief strategic advisor and his re-designation as group operating officer and adviser to the MD.

SEBI has levied a fine of Rs 3 crore on Ramkrishna, Rs 2 crore each on the National Stock Exchange (NSE), Subramanian, and former NSE MD and CEO Ravi Narain, and Rs 6 lakh on V R Narasimhan, who was the chief regulatory officer and compliance officer.

The case is against a stockbroker who manipulated NSE’s system with help from then-top officials to get access before anyone else to markets when they opened. Sanjay Gupta (promoter of OPG Security Pvt Ltd), Aman Kokrady, his brother-in-law, and data cruncher and researcher Ajay Shah have been named by CBI as accused in the case, along with unknown officials of the NSE and SEBI.

The National Stock Exchange, the country's largest bourse, is believed to have rolled out co-location services in 2009-2010.

Co-location is a setup in which the broker's computer is placed in the same area where the stock exchange's server is located. This gives brokers a speed advantage in comparison to other brokers. The broker whose computer is placed in NSE’s server room gets access to market feed before other brokers, allowing them to make huge financial gains through stock trading.

(With inputs from Chetan Bhutani)

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