CBI searches 82 places in chit fund scam by former Andhra Pradesh MLA

The CBI on Wednesday carried out searches at 82 places in connection with two cases registered on the directions of the Jharkhand High Court to probe the role of 33 chit fund companies owned by a former MLA of Andhra Pradesh.

PTI| Last Updated: Mar 16, 2016, 21:25 PM IST

New Delhi: The CBI on Wednesday carried out searches at 82 places in connection with two cases registered on the directions of the Jharkhand High Court to probe the role of 33 chit fund companies owned by a former MLA of Andhra Pradesh.

During the searches, the CBI claimed to have recovered Rs 44.90 lakh from the ex-MLA of Vishakhapatnam-West who was also the Managing Director of a chit fund company, a CBI spokesperson said in a statement.

According to the spokesperson, the agency conducted searches at the MLA's residence and premises of his 33 companies.

The searches were conducted at 82 locations in Jharkhand, Bihar, Odisha, West Bengal and Andhra Pradesh, she said.

The CBI had registered two cases against group of companies owned by the former legislator, their Managing Directors, Directors and other officials on the directions of Jharkhand High Court.

It was alleged that the companies and their officials were involved in receiving huge public deposits "illegally and fraudulently" by cheating and alluring common people with false promises such as high rate of interest, issuing shares or debenture, private placement, purchase of land, product purchase etc.

The accused allegedly siphoned off or diverted the funds received "illegally and dishonestly" to their individual accounts, the CBI claimed in its FIR.

During the searches, Rs 44.90 lakh (approximately) cash was seized from the residence of the ex-MLA, who was the Managing Director of one of the companies, and Rs 16.80 lakh (approximately) from the house of then Director of another company.