Saradha chit fund scam: Government to probe group companies
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Amidst growing protests outside a Kolkata court against an alleged chit fund scam, the Corporate Affairs Ministry on Thursday decided to conduct a probe into Saradha group companies.
The Chairman of the Saradha Group Sudipta Sen, was produced before a Kolkata court in the wake of the chit fund fiasco. Sen, who is one of the three accused has accused twoTrinamool Congress (TMC) MPs of 'extortion' and 'blackmail' and blamed them for his downfall. The protests come as the controversy over the Kolkata-based entity allegedly duping thousands of investors grows.
Sen, in a letter to Central Bureau of Investigation (CBI), threatened to commit suicide over his predicament, as he feared he would not be able to refund the public money.
Meanwhile, Market regulator Sebi is probing the fund-raising activities of Saradha group. Besides, the Income Tax department would investigate investments and finances of Saradha group and the department is already probing five other similar cases in West Bengal.
The Central government has also swung into action to control the fallout of the Saradha Group Chit Fund scam. Mamata Banerjee has also announced setting up of a Rs 500-crore relief fund for the investors of the chit fund.
The Department of Financial Services in the Finance Ministry and the Ministry for Corporate Affairs (MCA) will together work out a plan to help investors get back their money and think long-term measures to prevent such frauds.
Sources told ET that Corporate Affairs Minister Sachin Pilot is likely to make a few announcements on how the government plans to try and 'salvage' investors' money estimated to run into a few thousands of crores. A senior official of the Department of Financial Services confirmed to ET that the Finance Ministry will hold discussions with MCA on the possible actions that can be now taken to protect the interest of investors.
The West Bengal-based Saradha Group is not registered with the Reserve Bank of India under deposit taking Non-Banking Financial Companies (NBFCs-D) or Residuary Non-Banking Companies (RNBCs), the finance ministry official said. Even the MCA database does not show Kolkata-based Saradha Group registered as a chit fund company.
"So, it's a unique problem, where the regulator cannot take any action," a finance ministry official said.
Another finance ministry official said that state governments need to be more proactive to ensure that such scams are nipped in the bud. "We have been informed that more than 100 companies in Assam, which are not registered with RBI as deposit taking companies, are involved in such schemes. So, the state government needs to crack down on such ponzi schemes," he said. (Economic Times)
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