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Speak Asia legal advisor Saraogi quits

N Sundaresha Subramanian  |  Mumbai 

Barely five days after he was hired by Speak Asia as its legal adviser, Ashok Saraogi withdrew from the case last Friday. The company was under scrutiny for what happened to be a enticement of online customers from something like a pyramid scheme.

The Mumbai-based lawyer decided to quit after the online survey company said that Singapore-based United Overseas Bank had requested the closure of its accounts on the same day.

When contacted, Saraogi declined to comment. Speak Asia hinted that payments would be delayed by a few weeks. “Due to the media noise, on May 25, UOB at Singapore pressed us for closure of our two bank accounts within two days, without giving us the chance to present our case or even listen to us,” Harender Kaur, chairperson and CEO, Speak Asia, said in a letter addressing “fellow SpeakAsians.”

Kaur also said in order to set up a seamless International Banking Gateway like the one at UOB, takes at least six to eight weeks of interbank and managed IT infrastructure coordination and implementation. An email questionnaire sent to UOB spokespersons in Singapore remained unanswered.

According to the company, all payments processed by speakasiaonline between May 13 to 20, were held up because the telegraphic transfers have not been sent from Singapore to India, by UOB.

An email questionnaire sent to UOB spokespersons in Singapore remained unanswered.

According to sources close to Saraogi, since the investigations are on in several fronts, it wasn’t possible for a single lawyer to handle it. “Some estimates put the money involved at Rs 10,000 crore. With the accounts now being frozen, not a single penny is going to come out for a while. It is difficult for a single lawyer who already has commitments to handle these,” a person familiar with the development said.

Last week in a press conference, Saraogi had defended the business model of the company and had given it a clean chit.

“There is nothing illegal about an internet-based foreign company doing business in India.” He had assured that in his capacity as legal adviser, he will recommend the company to improve disclosures on ownership patterns and associate companies’ business models. He had also said that he would recommend an exit option for investors, who were allegedly misled by the company.

However, under pressure from investor groups, regulatory authorities have begun to freeze the accounts of the company and its agents, restricting the money flow. Speak Asia said some accounts of its agents in the local banks have also been frozen. However, officials in several banks said there have been no such freeze orders. Spokespersons of these banks declined comment as banking regulations did not permit them to comment on actions on individual bank accounts.

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First Published: Tue, May 31 2011. 00:21 IST