Indian Regulator Declares: Mr. Shah Not Quite Fit & Proper

After a spree of scandals, Jignesh Shah, one of India’s richest men has been outlawed from running the most liquid commodity Exchange , the Multi Commodity Exchange.

The Forward Markets Commission, the country’s main forwards and futures regulator has announced in an 80 page Order that the former chief operators of the Multi Commodity Exchange, Jignesh Shah, Joseph Massey and Shreekant Javalgekar, are not ‘fit and proper’ and are barred from managing the exchange. The notification comes on the back of fraud and misappropriation after the National Spot Exchange was shut down by the regulator.

Things have gone from bad to worse for Mr. Shah who recently stepped down from his managerial position at MCX. In the latest episode, the regulators have deemed Mr. Shah and his accomplices as unfit and improper, thus significantly impacting their reputation and position as responsible financial services professionals.

The eighty page document compiled by the regulator outlines what it believes the qualities a fit and proper person should hold, stating: “Such person has a general reputation and record go fairness, integrity, including but not limited to

a) financial integrity

b) good reputation and character, and

c) honesty”

Since its inception in 2003, the MCX has grown to dominate the commodity derivatives arena in India with over 80% market share.

FTIndia, the technology firm behind the MCX, operates a number of exchanges in Africa and Asia. The listed company was trading 1% lower today closing at INR 166.35.

Mr. Shah is regarded as the pioneer behind electronic trading in India. He was also one of the front-runners in launching rupee-based futures on the DGCX. Mr. Shah was listed on the Forbes (India) rich list, in 2010 he was ranked at 81 with his net worth estimated to be $610 million.

FTIndia nor MCX were available for comment.