Naveen orders judicial probe into chit fund fraud

State govt will request Odisha HC to spare services of sitting judge to enquire into alleged cases of financial fraud

Odisha Chief Minister Naveen Patnaik today ordered a judicial probe into chit fund fraud in the state which has created ripples with revelation by some arrested fund promoters that they had paid political leaders, bureaucrats and media persons to run their business uninterrupted.    

The state government will request the Odisha High Court to spare the services of a sitting judge to enquire into alleged cases of financial fraud by entities like Saradha Group, Seashore Group and Artha Tatwa (AT) Group. The judicial commission will submit its report within three months.

The mandate of the commission will be to suggest measures to safeguard the interests of genuine investors affected by recent incidents of chit fund fraud.

The probe is also aimed at bringing out the involvement of influential persons including politicians, bureaucrats and other sections of the society in protecting or promoting fraudulent chit fund companies.

In addition, the judicial commission will suggest safeguards for the future to ensure financial security for the genuine investors.

Recently, the state government had decided to get these cases settled by a fast track court.

To expedite disposal of such cases, special prosecutors will be appointed.

Finance minister Prasanna Acharya had announced that properties of all fraudulent companies will be confiscated and depositors’ money will be returned.

Meanwhile, the state government was awaiting Presidential assent to its Bill passed in the assembly to curb incidents of fraud by chit fund companies.

The Bill – Odisha Protection of Interests of Depositors (in Financial Establishment) -2011 – after obtaining the Presidential assent will enable the state to initiate punitive action against the offenders.

So far, 180 cases have been registered against 85 companies and 176 people have been arrested for swindling money of innocent depositors. The fraud cases have been assessed to be worth Rs 138 crore.

That apart, the economic offences wing of Crime branch has lodged 27 cases against 24 companies for offences of a similar nature.

Of late, the state crime branch has raided and sealed offices of Seashore and Artha Tatwa groups, two of the largest chit fund companies in different parts of the state. Police have also arrested Pradeep Sethi, chairman of city-based Artha Tatwa (AT) Group and another director of the company. Sethi has revealed that he had paid about Rs 75 crore to political leaders, bureaucrats and media persons for protection of his business interests.