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Commentary

Jignesh Shah: Anatomy of a Crumbling Titan

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There was a time when Jignesh Shah was a rising star in the commodities and futures industry. Today this isn’t the case.

Jignesh Shah, Chairman of FTIL. Photo: Norbert Schiller

He has lost control over his financial empire. The number of nominees on the MCX board is down to one and institutional shareholders have all but taken over the MCX-SX board. At one point, Jignesh Shah was an important player in Bahrain. As the Chairman of BFX and BFX Clearing and Depository Corporation (BCDC) he received the special attention of Prince Khalifa Bin Salman Al Khalifa in Feb 2011. Touted as the first exchange platform in West Asia, BFX offered equities, commodities, bonds, currencies, Islamic financial instruments and Sharia-compliant products. But three years later, the BFX website displays just three board of Directors. There is no mention of Jignesh Shah on the website.

FTIL had to sell off its 100% stake in Singapore Mercantile Exchange, launched with much fanfare three years ago, to ICE Singapore Holdings, owned by Atlanta-based ICE group, for $150 million USD. FTIL’s sudden exit from SMX and SMX Clearing Corporation was allegedly masterminded by Monetary Authority of Singapore (MAS), the financial regulator in Singapore. MAS reportedly has a way of telling exchange owners to do things their way or lose their licenses. FTIL Group’s entire ecosystem is in a state of flux, but nothing can be worse than Dubai Gold Commodity Exchange a 50:50 joint ventures between Dubai Multi Commodities Centre DMCC and DGCX. DGCX prospered with the support of Indian bullion and diamond merchants in the Emirates and became the first bourse to offer dollar-rupee forex trading. FTIL held two of the five nominated seats on the board —Shah (Vice-chairman), Joseph Massey (Director).

Though the DGCX website still mentions Jignesh Shah as its Vice Chairman – this is as far as the love affair goes. Today as per the DGCX website the four Directors on its Board include Ahmed Bin Sulayem as Chairman, Jignesh Shah, Vice Chairman, Abdul Wahid Al Ulama, who represents the Dubai Financial Services Authority (DFSA), Commercial Bank of Dubai and International Chamber of Commerce (ICC) as an Independent Director and Gautam Sashittal – an Indian emigrant as non-executive member on the board of directors of DGCX since Jan 2010. With a background in accounting as well as in the oil and gas industry, Gautam Sashittal - a former CFO of Dubai Gold and Commodities Exchange (DGCX) is now CEO of DMCC, a Dubai government Authority, responsible for establishing Dubai as a global gateway for commodity trading by providing the appropriate financial infrastructure and services.

Botswana-based $100 million Bourse Africa chaired by former President of Botswana, Festus Mogae, is like a dormant volcano- no one knows when it will burst, if at all. It was targeted to go live in 2009. But five years down the line — the Exchange is nowhere close to meeting the needs of the African people.

Prime Minister of Mauritius, Dr. Navinchandra Ramgoolam, described the Global Board of Trade as – “a small step for GBOT but a big stride for the Mauritian economy” at the time of its official launch in Oct 2010. Today GBOT is allegedly the shame of Mauritius - embroiled in several controversies. Sudeep Rawool, a former senior manager in trading and surveillance at GBOT has filed a case in the Mauritius Supreme Court alleging that 85% of the trades conducted at the exchange are fictitious and the bourse routinely violates local money laundering laws. Jignesh Shah is the vice chairman of GBOT - a 100% owned entity of FT Group regulated by Financial Services Commission (FSC) of Mauritius.

Back in India the Serious Frauds Investigation Office (SFIO) is investigating the affairs of NBHC. FTIL which had to sell off a 6 percent stake in the IEX to bring down its stake to 25% — as required by the Central Electricity Regulatory Commission. There was a time when NSEL was contributing as much as 50% of the FT revenues. A probe by the Registrar of Companies (RoC) revealed that the NSEL board had met only 46 times. At none of these meetings was the business model of the exchange discussed. There was a rampant practice to cheat investors and submit false records to the RoC. Even forged minutes were prepared of fictitious Board Meetings which never took place.

What did Jignesh Shah gain in the process? Does the remuneration of Rs. 18.02 crore - around 2.4% of Financial Technologies consolidated revenues and 7.9% of Net Profits in FY 13 or Rs. 15.5 crore – i.e. 3% of FT’s revenues and 23% of net profits in 2012 – justify the loss? Is this the price paid for success?

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37 comments
vijay jain
vijay jain

this is only in india  scammer are welcome and victims are smashed.  pl.do write such story  welcome by 60 K victims 

thanx 

vijay jain
vijay jain

this is only in india  scammer are welcome and victims are smashed.  pl.do write such story  welcome by 60 K victims  thanx

Aashish shah
Aashish shah

It seems jignesh's main business was money laundering thru exchanges around the world helping politicians , who are now protecting him. The fact of the matter is time runs out for all , as it did for sahara today   

Aashish shah
Aashish shah

It seems jignesh's main business was money laundering thru exchanges around the world helping politicians , who are now protecting him. The fact of the matter is time runs out for all , as it did for sahara today

Raj Mehta
Raj Mehta

People like Jignesh Shah prosper in the first place.... because of corrupt politicians of India.

They allowed him a free place to loot thousands of investors and now.... are shielding him from judiciary by the power of money.

GOD bless INDIA.... and its people, of such pathetic democracy.

Raj Mehta
Raj Mehta

People like Jignesh Shah prosper in the first place.... because of corrupt politicians of India. They allowed him a free place to loot thousands of investors and now.... are shielding him from judiciary by the power of money. GOD bless INDIA.... and its people, of such pathetic democracy.

CAAshishJainKothari
CAAshishJainKothari

Jignesh should learn from the situation of Subroto Roa of sahara , that day is not far when all the top Policitions and people who are supporting will leave him, today Mr roy is underground, he will also face same situation soon

CAAshishJainKothari
CAAshishJainKothari

Jignesh should learn from the situation of Subroto Roa of sahara , that day is not far when all the top Policitions and people who are supporting will leave him, today Mr roy is underground, he will also face same situation soon

sutolani
sutolani

I am not sure if top Policitions are not involved in this. Chidambram, Mayaram are not taking sufficient action. MPID and EOW are very slow. Sharad Pawars NAFED is inafact one of the defaulters and a share holder in NSEL.

sutolani
sutolani

I am not sure if top Policitions are not involved in this. Chidambram, Mayaram are not taking sufficient action. MPID and EOW are very slow. Sharad Pawars NAFED is inafact one of the defaulters and a share holder in NSEL.

Anil Kumar
Anil Kumar

sometimes you get blinded by the faith provided by politicians and large business houses that your humble beginning scares you. You either ally with them or risk a challenging time.


He chose the former one.


Anil Kumar
Anil Kumar

sometimes you get blinded by the faith provided by politicians and large business houses that your humble beginning scares you. You either ally with them or risk a challenging time. He chose the former one.

HemendraPaliwal
HemendraPaliwal

HIGHLY DISAPPOINTING... Investment through the recognized exchange are not safe in India .... bureaucrats wait for 5 years having full knowledge of the mismanagement in the National spot exchange..... Wait till the time more than 13,000 investor  stuck in ponzy scheme.......

HemendraPaliwal
HemendraPaliwal

HIGHLY DISAPPOINTING... Investment through the recognized exchange are not safe in India .... bureaucrats wait for 5 years having full knowledge of the mismanagement in the National spot exchange..... Wait till the time more than 13,000 investor  stuck in ponzy scheme.......

Yadu Ved
Yadu Ved

Jignesh Shah has proved that he is a scamster. and inaction by Govt of India to see through this is sad, as the Singapore and Bahrain Monetary Authority has been much more proactive in dealing with and preventing a financial crisis brought upon by the hunger for false revenue and profitability in order to mislead stock market analysts and get a large stock market trade volumes and artificial prices.

The lack of governance by regulators and political protection granted by to Jignesh Shah only goes to prove that India is still in the middle ages as far as Corporate Governance standards go! 

Yadu Ved
Yadu Ved

Jignesh Shah has proved that he is a scamster. and inaction by Govt of India to see through this is sad, as the Singapore and Bahrain Monetary Authority has been much more proactive in dealing with and preventing a financial crisis brought upon by the hunger for false revenue and profitability in order to mislead stock market analysts and get a large stock market trade volumes and artificial prices. The lack of governance by regulators and political protection granted by to Jignesh Shah only goes to prove that India is still in the middle ages as far as Corporate Governance standards go!

RohitKumarSonthalia
RohitKumarSonthalia

Jignesh is a master scamster and has full support of the government . He has fixed every officer in all departments. Even today he is roaming free. India's democracy is being made a mockery .

RohitKumarSonthalia
RohitKumarSonthalia

Jignesh is a master scamster and has full support of the government . He has fixed every officer in all departments. Even today he is roaming free. India's democracy is being made a mockery .

dhananjayparanjpe
dhananjayparanjpe

Such things are the one which promote Investment in Gold MR Chindambaram and PM should take a note of it and ACT

dhananjayparanjpe
dhananjayparanjpe

Such things are the one which promote Investment in Gold MR Chindambaram and PM should take a note of it and ACT

alifaraz
alifaraz

My entire life saving is gone...God please don't spare them and give them worst life suffering, more then any suffering of  investors.

alifaraz
alifaraz

My entire life saving is gone...God please don't spare them and give them worst life suffering, more then any suffering of  investors.

jigar
jigar

such a thing happens in India

Arunesh
Arunesh

None of govt investigative agencies are willing to take action against Jignesh shah. Top guys in some agencies are/ were board members in his group and they are pulling strings.

In India there is a saying that with money you can buy anything and this is what Jignesh has done.

Arunesh
Arunesh

None of govt investigative agencies are willing to take action against Jignesh shah. Top guys in some agencies are/ were board members in his group and they are pulling strings. In India there is a saying that with money you can buy anything and this is what Jignesh has done.

Arunesh
Arunesh

Jignesh Shah has shamed India by indulging in scams in Botswana and on the national spot exchange.

There are so many FIRs , legal suits and writs filed against him.

He must be arrested immediately.

Arunesh
Arunesh

Jignesh Shah has shamed India by indulging in scams in Botswana and on the national spot exchange. There are so many FIRs , legal suits and writs filed against him. He must be arrested immediately.

swalpa73
swalpa73

NSELSCAM for chidu..international shame will be India's Pride.

Vivek K
Vivek K

Jigesh Shah is a fraud and he should be behind bars. He has cheated thousands of innocent investors. Foreign investors should be careful as Indian politicians support such people.

Vivek K
Vivek K

Jigesh Shah is a fraud and he should be behind bars. He has cheated thousands of innocent investors. Foreign investors should be careful as Indian politicians support such people.

vivekkapoor39
vivekkapoor39

Jignesh Shah is a big fraudster of India  !  

vivekkapoor39
vivekkapoor39

Jignesh Shah is a big fraudster of India  !

ashitkothi
ashitkothi

CLASSIC EXMP. OF GREED TAKING OVER SENSES AND SENSIBILITIES.

ashitkothi
ashitkothi

CLASSIC EXMP. OF GREED TAKING OVER SENSES AND SENSIBILITIES.