The Enforcement Directorate (ED) on Tuesday arrested former Mumbai Police Commissioner Sanjay Pandey in National Stock Exchange (NSE) co-location scam case.

Pandey was arrested under provisions of the Money Laundering Act (PMLA) after his day-long questioning at the agency's headquarters here, an official said. Pandey, who retired as Mumbai Police Commissioner recently, was earlier questioned by the ED in the case.

The agency's move comes after it reportedly found enough evidence in the NSE co-location scam in which it wanted to know the role of an audit company, incorporated in 2001 by the retired Mumbai Police chief, for raising a red flag that the NSE servers were compromised.

The compromise had allowed one of the trading companies to get unfair access to the system, resulting in windfall profits.

The case is already being probed by the Central Bureau of Investigation (CBI) since 2018.

It is alleged that the firm incorporated by Pandey was one of the IT companies tasked with conducting security audits at NSE from 2010 to 2015 when the co-location scam is believed to have taken place.

Pandey is a 1986-batch Indian Police Service (IPS) officer who retired from service on June 30.