Just yesterday, we were congratulating SEBI on its intended progressive use of technology for e-IPO. Unfortunately, today we need to point out the serious security issues that remain to be addressed when IT usage is taken to critical areas such as investments.
A whistle blower from Singapore has now revealed a major fraud which he alleges has been going on in NSE for a long time which has been hushed up by the Stock Exchange.
The enclosed document provides in graphic detail the modus operandi used by certain broking firms to gain unfair advantage in trading with the connivance of the staff at NSE. (Also read this article in Moneylife)
Similar tactics were employed earlier in IRCTC which was brought to public notice by Naavi.org. However, in comparison, the impact of the present fraud in NSE is far far greater.
It is possible that NSE might have tightened up the security now. However there is a need to identify the individuals responsible for the fraud and send them to jail for life.
Hushing up is providing protection to such fraudsters who may re surface in other companies.
NASSCOM also has to issue a notice to NSE so that the “National Skills Registry” contains the correct information about these fraudsters.
People like Arnab who bark up the wrong tree need to address issues such as these instead of shouting on political rivals.
The incident also highlights how information security audit of NSE system has failed and can fail again in future.
We do understand that rather than blaming everybody in the administration, we need to appreciate the corrective measures taken and enable the management to set things right without any panic reaction that may cause more damage.
We look forward to a proper explanation from NSE authorities along with an assurance that checks and balances will be built to address such issues in future.
At the same time we need to thank the whistle blower for bringing the problem to public knowledge.