BHUBANESWAR: A Special court here on Friday convicted Managing Director of Micro Finance Ltd (MFL), Ashok Kumar Patnaik in a multi-crore chit fund scam. Pantaik was sentenced to three and half years rigorous imprisonment and imposed a penalty of `15,000 by the Special CJM (CBI) on Friday.
Patnaik had recently pleaded guilty of the charges pressed against him by the CBI. The CBI court has directed MFL to deposit `105 crore failing which its properties would be attached.
The company faced charges of defrauding gullible depositors of around `400 crore by floating six companies in the Sate that includes Micro Leasing and Funding, Micro Hotels, Micro Constructions, Micro Hospitals and Micro Media. Patnaik was arrested by the CBI in March 2014.
In February 2015, the CBI filed chargesheet against five people including former CMD of the company, Durga Prasad Mishra and MD Patnaik and three directors of MFL. They were charged under various sections of the Indian Penal Code and the Prize Chit and Money Circulation (Banning) Act, 1978.
MFL was barred by the Reserve Bank of India (RBI) in September 2012 from collecting deposits from people. The company’s founders, floated Micro Leasing and Funding Pvt Ltd to dodge the regulatory bodies and continue collecting public deposits.