In May 2011, long before the National Spot Exchange Ltd (NSEL) scam came to light, India’s financial regulators already knew trouble was brewing. A forum of aggrieved NSEL investors has now dragged the central bank to court for not acting against the exchange. MCA, it must be noted here, was the government body that gave birth to the poorly regulated spot exchanges in the first place. RBI’s reply to the court suggests that the second FSDC sub-committee where the NSEL matter was discussed was as late as November 2012, or about 18 months after the first one. While all of this reflects poorly on the central bank, it can be argued that the entire FSDC sub-committee is to blame.

Source: Mint October 19, 2016 20:37 UTC