Hundreds of depositors cheated as two chit fund cos closed

Last Updated: Sunday, March 21, 2010 - 22:31

Vijayawada: Hundreds of depositors from
small and middle class families including retired persons have
been cheated by two chit fund finance companies owned by one K
Umamaheswarudu, as the two companies have been closed, police
said.

The two finance companies belonged to a single family.

Umamaheswaradu started Sai Vuma Chit Fund company and Vuma
Maheswara Finvest Company 20 years ago and he became popular.
Particularly one community from Satyanarayanapuram locality
believed him totally and deposited their savings in his chit
fund companies.

For a long time, he regularly repaid the deposits with
interests and met all commitments without fail. Along with
these finance companies, he invested huge amounts in real
estate at various places in Hyderabad city and other places of
the state. He also started a hotel near Vijayawada Highway.

Since a few months, he has been postponing all
repayments and re-writing all promisory notes instead of
clearing them. All of a sudden, two days back, some of the
investors, who have not received the payments in time, filed
complaints with Satyanarayanapuram police. This revealed the
total financial position of Umamaheswarudu.

Since Sataruday, a number of depositors filed
complaints against Umamaheswarudu and are seeking the police
help to get their dues from him. Satyanarayanapuram Circle
Inspector SravanaKumar told PTI that as many as 190 depositors
have filed complaints against Umamaheswarudu and other
depositors are watching the situation.

He said that cases have been registered against him
under sections 420 of IPC and also under the provisions of
Andhra Pradesh Protection of Depositors of Financial
Establishments. He informed that though he was not taken into
custody, properties belonged to him and his family members are
being identified. Assistant Commissioner of Police A Subba Rao
told PTI that this is a white collar crime and needs a
detailed investigation.

One of the depositors Ch Veera Bhadra Murthy said that
Umamaheswarudu has been postponing repayments since a long
time, he cheated many small investors, but remitted deposits
of well to do and influenced investors. Most of the depositors
who suffered with the closure of the two chit fund companies
are small, retired and daily wage workers.

There are speculations that some cinema actors and
directors who previously invested in these two firms somehow
saved themselves by registering properties of Umamaheswarudu
on their names. An influenced doctor from the city also did
the same by taking over some property of Umamaheswarudu.

Umamaheswarudu has to pay more than Rs 100-crore to
his depositors. This is the fourth financial institution
closed and cheated the depositors in the city in recent
months. previously, Sailata Chit Fund company promoted by a
retired police officer cheated retired police personnel to the
tune of Rs 40-crore. Later, Anupama chit fund Company cheated
depositors to the tune of Rs 100-crore.

Another Vasudha Co-operative Socity also cheated the
investors by more than Rs 10-crore.

PTI



First Published: Sunday, March 21, 2010 - 22:31

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