The Serious Fraud Investigation Office (SFIO) has found that the Saradha group of companies siphoned off over Rs 2,500 crore by running several chit funds and collective investment schemes, duping lakhs of small investors lured by promising astronomically-high returns on their deposits.
A source told The Indian Express that “the SFIO has established the money trail of amount worth Rs 2,500 crore which was siphoned off by the group companies for investing in unlawful activities”.
The source said that the SFIO, the investigating arm of the ministry of corporate affairs, has found several violations of the Companies Act 1956, mainly Section 58 A and 628 pertaining to public deposits and false statements, along with violations pertaining to negligence by auditors and directors.
According to Section 58 A, deposits from public can not be invited without issuing an advertisement while the Centre prescribes the limits, manner and conditions subject to which deposits may be invited. Section 628 deals with penalty for false statements including any return, report, certificate, balance sheet, and prospectus.
“According to the modus operandi, daily collections were made by gathering money from very small, largely rural, investors. The agents who made the collections were paid off handsomely for their work. The money was then apportioned to 14 group companies with the help of a software developed by a private company specifically for this purpose,” the source said.
Violations pertaining to Indian Penal Code as well, have been found by the SFIO including section 409, 419, 406 and 403 regarding criminal breach of trust, cheating by impersonation, dishonest misappropriation of property.
“The report and evidences will be shared with the CBI and Sebi who are also investigating the scam,” the source added.
The Supreme Court had ordered the CBI early this year in May to take up the investigation in the multi-crore scam. The CBI has already made several arrests in the case including the top cop of West Bengal, DG Police Rajat Majumdar, and singer and filmmaker Sadananda Gogoi for their alleged involvement in the scam.
The Saradha scam came to light in April last year after which group chairman Sudipta Sen was arrested along with two of his associates. Since then, the scam has also implicated West Bengal Chief Minister Mamata Banerjee, who allegedly was close to Sen. In fact, suspended Trinamool Congress MP Kunal Ghosh, who is in the CBI custody for his role in the scam, has demanded that he should be jointly interrogated with Mamata and Sen. Recently, during a rally in West Bengal, BJP president Amit Shah claimed that the scam would sink the Mamata Banerjee government in the next Assembly elections in 2016.
The source said that the Sebi will prosecute for violation of the Sebi Act for running collective investment schemes. Also, several instances of violation of the Prize Chits and Money
Circulation Schemes (Banning) Act, 1978 have also been found and since prosecution under this has to be initiated by the state government, the ministry of corporate affairs will also share report with it.
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