According to SFIO, the Saradha group companies will face prosecution for violation of several laws
The Serious Fraud Investigation Office (SFIO), which completed its probe into the Saradha ‘chit fund scam’, said that its 14 group companies have been found to be running ‘ponzi schemes’ and would face prosecution for violation of several laws.
The investigation concluded that the group was using collections from new investors to make payments to the previously-enrolled members, rather than from income generated through investments, in typical resemblance to a ponzi scheme.
Among others, the activities of these companies were found to be in serious violations of the Companies Act, the SEBI Act, and several provisions of the Indian Penal Code, the Ministry of Corporate Affairs (MCA) said in a statement on completion of the SFIO probe.
The Ministry said those companies which have been found to have violated the SEBI regulations for ‘collective investment schemes’ would be prosecuted for violation of SEBI Act, instead of the Companies Act, as the former carried longer terms of imprisonment.
Besides, prosecution would also be initiated by the state governments for violations of the Prize Chits and Money Circulation Scheme (Banning) Act, while the probe report and necessary evidence would be shared with CBI to avoid duplication in prosecutions.
The scam, in which lakhs of investors in West Bengal and neighbouring states were defrauded of thousands of crores through illegal money pooling activities, came to light early last year and has also had its political ramifications.
The case has also become a political hot potato with the Mamata Banerjee-led West Bengal government facing flak from various quarters.
“The companies, their promoters, directors and managerial personnel have been found guilty on many counts of various provisions of the Companies Act... dealing with illegal collection of deposits and false statements," it said.
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During that time a very honest police officer alleged that many of the high officials were involved in the scam but till date no action was seen taken on his allegation.
A vigilance court inquiry was ordered against the then Finance Minister but nobody knows the fate of that enquiry ordered by the vigilance court.
http://www.madhyamam.com/en/node/2562
Where is MUKU (MUGU) JAMES ? Managing director of Unipay2u? Why the Government is not taking any serious action to bring him back to India to face criminal trial?