Rajeev Kumar has been under fire from the CBI over missing documents linked to Saradha, Rose Valley scams
New Delhi: West Bengal Chief Minister Mamata Banerjee has been a dharna in the heart of Kolkata since Sunday evening protesting against the CBI questioning of the city police chief in the Rose Valley and Saradha ponzi scams. The CBI team had come to question Kolkata police commissioner Rajeev Kumar after he allegedly ignored summons from the agency on the two Ponzi schemes. The Saradha and Rose Valley scams rocked Bengal and many others adjoining states in east India in 2013.
Here are the 10 points you need to know about the Saradha and Rose Valley chit fund cases:
The Saradha scam was a major financial fraud which lured lakhs of investors to deposit money in its schemes with glossy brochures and the promise of abnormally high returns. An official estimate says Saradha had mopped up about Rs 1200 crore through its chit funds, but some calculations put that the figure closer to Rs 4000 crore. The company collapsed in April 2013.
The opposition had alleged that Mamata Banerjee's Trinamool Congress had close links with Sudipta Sen, the Chairman of the chit fund group. The perceived closeness allegedly also helped it get investors and agents on board. They point out that Trinamool Rajya Sabha MP Kunal Ghosh headed Saradha's media division. Another Trinamool MP, Shatabdi Roy, features in Saradha's promotional material. They also claim Mamata Banerjee had inaugurated two Saradha offices.
The group took to many ways to highlight its legitimacy. From investing in football clubs to sponsoring Durga Puja events, the company left no stone unturned to maintain a clean public image. Several political leaders from TMC received financial support from Saradha group and politicians from outside the state also benefited from the scam. The most affected states in the Saradha Ponzi scam were West Bengal, Odisha, Assam, Jharkhand and Tripura.
The Supreme Court transferred the case to CBI after serious allegations of international money laundering, severe regulatory failures and political nexus surfaced. The company's head Sudipta Sen went missing soon after the scam unfolded. He was reportedly incommunicado since the April 13, 2013, a few days before cheques issued by his Saradha Group began to bounce. He and his right-hand woman were arrested soon after in Jammu and Kashmir after a cross-country chase over many days.
Rose Valley scam was a bigger financial fraud than the Saradha scam and according to Enforcement Directorate estimates, more than Rs 15,000 crore was reportedly collected from depositors across India mainly from West Bengal, Assam and Bihar. According to ED, a portion of the money was also used to bribe politicians so that the scam can run smoothly. Millions of people invested their life savings with hopes of high returns but in the end, all that they had accumulated after years of hard work got lost in the deep web of scams.
Right after the Saradha scam unfolded, Bengal woke up to prominent ads in newspapers put out by Rose Valley, appealing to its investors not to panic in the wake of the collapse of the Saradha group's chit fund. Like the Sudipta Sen-owned Saradha, Rose Valley had a media division and owned four television channels.
The ED has alleged that the firm had floated the scheme promising inflated returns on investments between eight and 27 per cent to gullible investors in various states. The company had allegedly pledged astronomical returns to depositors on land properties and assets and bookings done in the real estate sector. The company has also been accused of making "cross investments" in its various sister firms to suppress its liabilities towards investors. The Securities and Exchange Board of India (SEBI) had probed the company before the ED and the CBI registered cases against the group.
The ED had registered an FIR against the firm, its Chairman Gautam Kundu and others in 2014 under the PMLA. Gautam Kundu was arrested by the agency in Kolkata in 2015. At present, he is in judicial custody. Multiple charge sheets have been filed in the courts in Kolkata and Bhubaneswar by the ED in this case.
Shrikant Mohta, head of one of the biggest film production companies in eastern India, had been arrested in Kolkata at the end of January for defrauding Rose Valley. The agency's sources said the film producer had taken Rs 25 crore from Gautam Kundu, head of chit-fund company Rose Valley. Shrikant Mohta was to produce several films for the Rose Valley group with that money. He did not deliver, and when Gautam Kundu asked him for his money, Shrikant Mohta allegedly warned him off -- dropping several powerful names along the way.
Rajeev Kumar, a 1989 batch IPS officer, had headed a SIT probe connected to Saradha and Rose valley ponzi scams before the case was transferred to the CBI in 2014 on Supreme Court's orders. He has been under fire from the CBI over missing documents linked to the investigations. After media reports that Mr Kumar was "absconding" and he was facing arrest by the CBI, the Kolkata police said they will take action over the "defamation" by media houses.