Saradha chitfund scam: SFIO report points to serious financial mismanagement

Last Updated: Monday, September 30, 2013 - 22:51

Zee Media Bureau

New Delhi: A day after the West Bengal government withdrew a bill aimed at protecting interests of depositors from chitfunds the Serious Fraud Investigation Office (SFIO) on Monday submitted its interim report.

A SFIO probe into the Saradha scam and `chitfund` operations of 62 other entities has found serious financial mismanagement and siphoning off the funds by their promoters, who took advantage of regulatory gaps.

The financial fraud investigative agency is also trying to get details stored by these entities on computer servers located abroad, the Corporate Affairs Ministry said today while releasing excerpts of the interim report on SFIO probe.

While the final report would be submitted by the Serious Fraud Investigation Office (SFIO) by December, the interim report has said that "useful information has been collected from the servers of the companies housed in India by using forensic technology.

"However, enforcement agencies are making all efforts to access information stored in servers located outside India," it said.

Earlier, the West Bengal Protection of Interest of Depositors in Financial Establishments Bill, 2013, which was passed by the state assembly following uproar over the Saradha chitfund scam, was taken back yesterday by the WB government after the Finance Ministry raised objections on a few points and sought clarification from the state government.

Notably, the chitfund group by the name of Saradha had sold big dreams, and many had invested every bit of their life’s savings; some had even left their jobs.

The group had got advances from investors as contribution for allotment of plots or flats besides a ‘money back’ option. However, there was an option for the investors to cancel the booking and get back their money with compound interest from 12% to 14%.

Mamata gives away cheques to defrauded Saradha depositors

Keeping to her promise to return money to the poor who had invested in the Saradha Group which went bust in April this year, Chief Minister Mamata Banerjee today distributed cheques to 929 such depositors.

Those who received cheques, as recommended by the Justice (Retd) Shyamal Sen Commission set up the West Bengal government, had invested up to Rs 10,000 in the ponzi schemes.

Speaking on the occasion, Banerjee called upon people not to make any investment henceforth in any chit fund company in view of the Saradha Group scam in which thousands had been defrauded.

"It`s my appeal. Please don`t keep your money with any chit fund company. It is most unsafe. Rather save money at home if you don`t find any other option," Banerjee exhorted the people.

Banerjee said her government wants to set up a Safe Saving Scheme in which small and medium investors could deposit their hard-earned money without any fear.

"But the scheme is yet to be finalised as an Act dealing with the scheme needs some clarification. Anyway, nothing will wait for any Act. We shall go ahead with our plan to return money to depositors of the Saradha Group of companies. I shall let you know when the scheme will be launched," she said.

With PTI inputs

First Published: Monday, September 30, 2013 - 21:41
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