Sebi exonerates three former NSE executives, seeks action against two

Mumbai: The Securities and Exchange Board of India (Sebi) has exonerated some of the former senior officials of the National Stock Exchange (NSE) in the colocation (COLO) case.

The regulator on Thursday exonerated Subramanian Anand, former group operating officer and former chief technology officers Ravi Apte and Umesh Jain from the charges levelled against them. However, it said both Mahesh Soparkar and Deviprasad Singh, former heads of project support management (PSM) team have failed to discharge their duties.

“..both have been found to have failed to discharge their duties as PSM team heads, by monitoring the access to secondary server by TMs (trading members) from time to time and administering uniform standards of discipline against the TMs. However, such conduct has been found to be suitable for handling by NSE so as to fix accountability on the employees, as deemed fit and appropriate,” Sebi said in its order.

NSE has been directed to initiate enquiry against these two employees and submit a report to Sebi within six months from the date of the order.

Anand Subramanian has contended before Sebi that he was not involved in COLO matters directly or indirectly and was only taking care of the regular operations of the exchange and the regulatory side of the exchange.

“His case is that he was a part-time consultant and he demitted office in October 2016,” the Sebi order said.

“I note that though Ravi Apte was designated as CTO during the relevant period, he was a consultant on contract, who was involved in providing guidance to the broad architecture needs for the co-location. Similarly, I note from the records that Umesh Jain became the CTO only on April 10, 2013 and after becoming a CTO, his responsibility was focused on changing the unicast TBT dissemination architecture into multi-cast dissemination,” Sebi’s adjudication officer said.

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The case dates back to 2015, when a whistleblower wrote a letter to Sebi alleging that NSE, India’s largest stock exchange, gave preferential access to a few high-frequency traders and brokers to the exchange’s trading platform. Sebi named the complainant as Ken Fong.

Co-location refers to traders being able to place servers in close proximity to those of an exchange, thus giving them a time advantage that translates into massive profits.



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