Letters: US-64 fiasco

In a season of scams, it is appropriate to recall the July 2001 collapse of the US-64 Scheme of the Unit Trust of India (UTI). It led to many small savers losing a substantial part of their lifetime earnings. There were rumours at the time that were corroborated by a former chief of State Bank of India, which had a representative on the UTI board, that big companies had made heavy withdrawals in June on learning about the troubles of the scheme. But no references were made to UTI officials themselves, withdrawing their investments with the advantage of their insider knowledge. A few years earlier, a committee had recommended an enquiry into UTI buying the shares of Reliance Industries at a considerably higher than market price. There was no follow-up. Given the low level of probity and public morals in the country, it would not be surprising if some UTI officials withdrew from the US-64 Scheme in May-June 2001. Even if no action can be initiated because of the limitation of the law, those who lost money have a right to know the names of people and the amount of funds they withdrew from US-64 through the repurchase of the units. Since the UTI accounts are computerised, it will not take much time to ferret out the information with an appropriate software.

A Seshan, Mumbai

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