SC orders CBI probe in chit fund scam

The Supreme Court today ordered CBI probe into chit fund scams in West Bengal, Odisha and Assam in which various companies, including Saradha, allegedly duped investors of around Rs 10,000 crore, while taking note of allegations of scamsters getting "patronage" of people in "high positions".
"Investigation by the State Police in a scam that involves thousands of crores collected from the public allegedly because of the patronage of people occupying high positions in the system will hardly carry conviction especially when even the regulators who were expected to prevent or check such a scam appear to have turned a blind eye to what was going on," a bench headed by Justice T S Thakur said.

Holding the scam as "sordid affair", the bench said that investigation by the State Police has not unfortunately made any significant headway in recovering the money.
Referring to a SEBI report, the bench said Saradha group had floated as many as 160 companies and four out of them were the front runners in this sordid affair.
The bench noted that as many as 2,21,000 agents were working for Saradha Realty India Ltd and the report estimates the collection made by the Saradha Group of companies at Rs 2,459 crores.
"That the companies indulge in ponzi schemes have their tentacles in different States giving the scam inter-state ramifications. That such huge collections could have international money laundering dimensions cannot be ruled out and needs to be effectively investigated," it said.

The bench, however, said at this stage it is not necessary to constitute a team to monitor the progress of the investigation into the scam, saying we leave open that option for the future.

"The Enforcement Directorate shall, in the meantime, expedite the investigation initiated by it into the scam and institute appropriate proceedings based on the same in accordance with law," it said.
The court said that CBI would probe against Saradha and 44 other companies in Odisha which are allegedly involved in the scam.
It, however, made it clear it is not expressing any opinion as to the complicity of those being investigated or others who may be investigated, questioned or interrogated in relation to the scam.

"Needless to say that the State Police Agencies currently investigating the cases shall provide the fullest cooperation to the CBI including assistance in terms of men and material to enable the latter to conduct and complete the investigation expeditiously," it said.
In the scam Kunal Kumar Ghosh, Member of Parliament, was arrested on November 23, 2013. Ghosh was the media CEO of Saradha Group of Companies.