being duped by such chit fund companies which are having a field day in their dealings with unsuspecting investors especially from the lower economic strata of the society as there was hardly any monitoring by the Government agencies. The Assam Government was content with issuing occasional statements asking people to refrain from investing in such non-banking financial organizations or chit funds.

However, the exposure of Saradha Group has now alerted the investors who have now realized the high degree of risk they have taken in investing their hard earned money in such unregulated financial organizations, most of which later turn out to be fly by night operators.

With investors across the State now baying for the blood of chit companies and their agents, the Assam Government has decided to hand over some of the cases registered against some fraudulent chit fund operators in the State to the Central Bureau of Investigation (CBI). In fact, a high-level CBI team has visited the State to take stock of the gravity of the situation in consultation with the officials of the CID of the Assam Police who are engaged in investigation into cases of fraud by these chit fund groups.

The Assam Police earlier registered four FIRs against Sudipta Sen and others for committing offences U/S 120B, 406 and 420 of the IPC.

Assam Chief Minister Tarun Gogoi who also holds the finance and home portfolios, informed that, to start with, 11 cases will be handed over to the CBI for investigation. These cases are related to Saradha Group, Rose Valley, Unipay 2 U, Jivan Suraksha, Prayag, Basil International Limited, Alliance Vision Marketing Limited, Daffodil Group of Companies, Abyss Assam Group Company, etc. These cases are from among the total 246 cases registered by the Special Investigation Team (SIT) of the CID of the Assam Police against 128 chit fund or non-banking financial companies operating in the State.

Out of these, 42 persons and 15 companies have been charge sheeted while three hundred and three persons have been arrested so far. Nearly Rs 94 lakh in cash has been seized and Rs 24 crore frozen. One hundred and six bank accounts have been frozen and a number of plots with a total area of more than 99 bighas including buildings have been identified and necessary steps are being taken up for their attachment.

Moreover, scam tainted Saradha Group’s operations in Assam will be probed by the Enforcement Directorate (ED) under the Union Ministry of Finance on the basis of four FIRs filed by the Assam Police against the arrested Saradha Group Chief Sudipta Sen and others. The ED has already registered a case based on four FIRs filed by Assam Police under the provisions of the Prevention of Money Laundering Act (PMLA) 2002, against M/s Saradha Realty India Limited and others.The Assam Police earlier registered four FIRs against Sudipta Sen and others for committing offences U/S 120B, 406 and 420 of the IPC.

The Assam Government has meanwhile stated in clear terms that the duped investors of chit fund companies including Saradha Group should not expect any compensation from it. Chief Minister Tarun Gogoi said that his government is not responsible for paying compensation to the investors duped by chit fund companies. He pointed out that investors ignored the Government’s advice made through mass media asking people to refrain from investing with unregulated non-banking financial companies. But the government apparently has no answer to its failure to keep these chit fund operators under surveillance in the greater interest of investors. These chit fund operators have struck deep roots in the State and it will be difficult to uproot them easily as so many people have invested money with them.

Filling the Void

The ground reality in Assam where banking network is not as widespread as desirable has facilitated the spreading of chit fund companies and their money making business far and wide at a fast pace thereby lulling the people into opting for risky investments with them. The small investors from vulnerable sections of the society are being exposed to chit fund agents on the prowl due to a lack of an adequate number of bank branches and India Post offices to provide alternative options for savings to them.

being duped by such chit fund companies which are having a field day in their dealings with unsuspecting investors especially from the lower economic strata of the society as there was hardly any monitoring by the Government agencies. The Assam Government was content with issuing occasional statements asking people to refrain from investing in such non-banking financial organizations or chit funds.

However, the exposure of Saradha Group has now alerted the investors who have now realized the high degree of risk they have taken in investing their hard earned money in such unregulated financial organizations, most of which later turn out to be fly by night operators.

With investors across the State now baying for the blood of chit companies and their agents, the Assam Government has decided to hand over some of the cases registered against some fraudulent chit fund operators in the State to the Central Bureau of Investigation (CBI). In fact, a high-level CBI team has visited the State to take stock of the gravity of the situation in consultation with the officials of the CID of the Assam Police who are engaged in investigation into cases of fraud by these chit fund groups.

The Assam Police earlier registered four FIRs against Sudipta Sen and others for committing offences U/S 120B, 406 and 420 of the IPC.

Assam Chief Minister Tarun Gogoi who also holds the finance and home portfolios, informed that, to start with, 11 cases will be handed over to the CBI for investigation. These cases are related to Saradha Group, Rose Valley, Unipay 2 U, Jivan Suraksha, Prayag, Basil International Limited, Alliance Vision Marketing Limited, Daffodil Group of Companies, Abyss Assam Group Company, etc. These cases are from among the total 246 cases registered by the Special Investigation Team (SIT) of the CID of the Assam Police against 128 chit fund or non-banking financial companies operating in the State.

Out of these, 42 persons and 15 companies have been charge sheeted while three hundred and three persons have been arrested so far. Nearly Rs 94 lakh in cash has been seized and Rs 24 crore frozen. One hundred and six bank accounts have been frozen and a number of plots with a total area of more than 99 bighas including buildings have been identified and necessary steps are being taken up for their attachment.

Moreover, scam tainted Saradha Group’s operations in Assam will be probed by the Enforcement Directorate (ED) under the Union Ministry of Finance on the basis of four FIRs filed by the Assam Police against the arrested Saradha Group Chief Sudipta Sen and others. The ED has already registered a case based on four FIRs filed by Assam Police under the provisions of the Prevention of Money Laundering Act (PMLA) 2002, against M/s Saradha Realty India Limited and others.The Assam Police earlier registered four FIRs against Sudipta Sen and others for committing offences U/S 120B, 406 and 420 of the IPC.

The Assam Government has meanwhile stated in clear terms that the duped investors of chit fund companies including Saradha Group should not expect any compensation from it. Chief Minister Tarun Gogoi said that his government is not responsible for paying compensation to the investors duped by chit fund companies. He pointed out that investors ignored the Government’s advice made through mass media asking people to refrain from investing with unregulated non-banking financial companies. But the government apparently has no answer to its failure to keep these chit fund operators under surveillance in the greater interest of investors. These chit fund operators have struck deep roots in the State and it will be difficult to uproot them easily as so many people have invested money with them.

Filling the Void

The ground reality in Assam where banking network is not as widespread as desirable has facilitated the spreading of chit fund companies and their money making business far and wide at a fast pace thereby lulling the people into opting for risky investments with them. The small investors from vulnerable sections of the society are being exposed to chit fund agents on the prowl due to a lack of an adequate number of bank branches and India Post offices to provide alternative options for savings to them.

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As of date, 128 chit funds are operating in Assam with their agents collecting money from cross sections of depositors in remote villages where there is no presence of bank branches and post offices. These chit fund agents target labourers, rickshaw pullers, MNREGA workers, farmers in the remote areas taking advantage of the lack of bank branches.

Assam’s education and health minister Dr. Himanta Bishwa Sharma’s  name was mentioned by Saradha Group Chief Sen in his letter to the CBI mentioning that the minister had cheated him by not less than Rs 3 crore.

According to official figures, only 30 per cent of the total population in Assam has bank accounts reflecting the poor state of the banking network in the State. There are 259 State Bank of India branches in Assam besides 707 branches of other nationalized banks, 399 regional rural bank branches, 68 branches of other banks totalling 1,433 bank branches that are operating in the State with a population of 3,11,69,272. The banks are found not to be very zealous in advertising their various deposit schemes to attract the common people. Moreover, banks are not found very receptive to illiterate people willing to open bank accounts in rural areas where the presence of post offices with small saving schemes is also very minimal. Assam has a total of 4007 post offices including 3721 in rural areas and 286 in urban areas. This means that there is only one post office per two lakh people in Assam and to make the situation worse, there is hardly any attempt by the authorities concerned to publicizethe numerous small savings schemes available in post offices. The chit fund operators also design their investment policies in such a way that that one can invest as little as Rs 10 per day which lures the poor people who also want to have some savings to secure their future.

Letter Storm

The arrested Saradha Group Chief Sudipta Sen’s reported letter to the CBI has also created a political storm of sort in Assam. Sen in his letter reportedly mentioned that influential politicians, individuals and police officials in Assam too took money from Saradha Group. He reported named a senior cabinet minister Dr. Himanta Bishwa Sharma, senior Congress legislator Anjan Dutta, three private TV channel owners Matang Sinh, Manoranjana Sinh, Sanjeev Jaiwal and an artiste Sadananda Gogoi among others. All of them have since denied taking any undue favour or money from Saradha Group which is now in the dock.

Dr. Himanta Bishwa Sharma has vehemently denied having any links with the scam tainted Saradha Group and stated that he had already sent legal notice to Saradha Group Chief Sudipta Sen regarding the baseless allegations made against him and would file a case against him if the latter failed to reply to the legal notice in time. The minister exuded confidence that he would come out unscathed from the allegation leveled against him.

Regarding his presence at the inauguration of a biscuit factory owned by Saradha Group at Dhubri in western Assam some time back, Dr. Sharma said he had gone to the inauguration of the biscuit factory on the request of editors of two popular local Dailies in Assam which had entered into business deals with Saradha Group.

On the other hand in a significant development artiste Sadananda Gogoi whose name was dragged into the Saradha controversy by Sudipta Sen’s reported letter to the CBI has resigned from the post of Secretary of the Assam Publication Board citing ill health and mental stress. He has tendered his resignation to the education minister Dr. Himanta Bishwa Sharma. The artiste was known to be very close to the minister Sharma and a former DGP of Assam Police.

Chief Minister Tarun Gogoi stated that his government could not take action against anyone on the basis of mere allegations made by certain quarters. The allegations have to be proved through proper investigation for action to take place, he said when questioned about Sudipta Sen’s allegations made against a minister, a ruling Congress MLA and others in Assam.

The Assam Government was content with issuing occasional statements asking people to refrain from investing in such non-banking financial organizations or chit funds.

Krishak Mukti Sangram Samity (KMSS), a leading NGO in Assam staged a mass demonstration in front of the Kamrup (Metropolitan) district Deputy Commissioner’s office in Guwahati demanding immediate steps from the government to ensure that people who have invested their money with the chit fund company get it back with interest immediately. The KMSS leader and RTI activist Akhil Gogoi leading the demonstration alleged that a section of politicians, bureaucrats and police officials had helped Saradha Group to set up business in the State at the cost of gullible common people. He demanded the resignation of State’s education and health minister Dr. Himanta Bishwa Sharma whose name was mentioned by Saradha Group Chief Sen in his letter to the CBI mentioning that the minister had cheated him by not less than Rs 3 crore. However, Akhil was not very vocal against other persons including a senior Congress leader, a TV channel owner and a senior Congress legislator from Assam who had dealings with Sen as per the disclosure made to the CBI in the letter.