Narain will be produced before a special court on Wednesday for custody. His role is being investigated by the federal probe agency as part of two criminal cases linked to the bourse – the alleged co-location 'scam' case and the purported illegal phone tapping of employees.
The former NSE CEO is understood to have been arrested in the tapping case under the criminal sections of the Prevention of Money Laundering Act (PMLA).
ED had registered and Enforcement Case Information Report (ECIR) in July against former Mumbai police commissioner Sanjay Pandey and former heads of the NSE for allegedly tapping the phones of employees between 2009 and 2017.
Pandey is the 1986-batch Indian Police Service (IPS) officer who retired from service on 30 June.
During the probe, it was found that Pandey is closely related to the functioning and activities of a company called iSec Securities Pvt Ltd. The company had conducted a security audit of NSE around the time the alleged co-location irregularities have taken place. The company was incorporated by Pandey in March 2001 and he quit as its director in May 2006. His son and mother took over the charge of the company.
This is the second case being investigated by the probe agency, which is probing alleged violation of money laundering norms in the colocation scam. This is the first time Narain has been arrested when the irregularities at the NSE had been a matter of investigation for five years now.
The ED earlier had arrested another former NSE MD and CEO Chitra Ramkrishna in the alleged phone tapping case while the CBI, which is parallelly probing these cases, had arrested her in the co-location case.
It has been alleged that illegal phone tapping of NSE employees was done between 2009-17.
