The Assam government has notified legislation providing for imprisonment up to 10 years for any person found guilty of frauds related to deposits and repayments by financial companies. The intention is to rein in dubious chit fund companies. The law is called the Assam Protection of Interests of Depositors (in Financial Establishments) (Amendments) Act, 2013. It also provides for a fine up to Rs 5, 00,000 with powers to attach the properties and money of the offending financial companies. The provisions will apply also to individual promoters, managers and other members of such companies. The Act empowers Deputy Commissioners and SPs (Economic offences) to receive complaints from depositors and to initiate probes into the allegations.
The Assam police have already got cracking. The state government had on May 6 handed over 12 cases against different chit fund companies to the CBI, two of which are related to the Rose Valley Group. Sudipto Sen, CMD of the Saradha Group which is now mired in scandalhas alleged that a minister in TarunGogoi’s government, Himanta Biswa Sarma, had taken at least Rs 3.5 crore from him over the last 18 months. Sarma has filed a defamation and a criminal case against him. The police have already frozen 10 bank accounts involving more than Rs 25 crore belonging to various chit fund companies in the state. Charges have been filed against 42 persons and 15 companies in 17 cases. The Assam government has already got down to business. The law on the anvil will tighten the screws on the chit fund criminals.
