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Special task force to probe chit fund firms

PTI     April 25, 2013
In the wake of an alleged fraud involving thousands of crores by Kolkata-based Saradha group, the Centre Thursday ordered a SFIO probe into suspected misuse of the public money by various chit fund companies.

A special task force has been set up under the Serious Fraud Investigation Office (SFIO) to carry out all investigations into such companies, the Indian Corporate Affairs Ministry said Thursday in a statement.

The decision was taken in view of a "larger public interest involved in these cases, and concerns regarding misuse/laundering by such companies of the ill-gotten wealth and the possibility that the promoters of these companies may strip these companies," the Ministry said.

The probe follows raging public protest against alleged duping of lakhs of investors by Saradha group through their chit-fund and other money-pooling activities in West Bengal.

After being on the run for several days, Saradha Group Chief Sudipta Sen was arrested in Kashmir valley two days ago and has been brought to Kolkata.

The Corporate Affairs Ministry said that the task force will also coordinate with other law enforcement agencies and regulators wherever required, in its investigations.

Capital market regulator Sebi has already passed an order against one group entity, Saradha Realty India, asking it to wind up all collective investment schemes and refund the money collected from investors.

Besides, Sebi is also probing at least ten other Saradha entities for raising funds without the regulator's approval.

The Income Tax Department would also soon start its investigations into the activities of this group.

Without specifically naming Saradha group, the Corporate Affairs Ministry said that it has "taken note of the misuse by certain chit fund companies who have raised huge sums of money from the public at large."

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