CMD of the Mid East Company here and six others here were arrested by the Town police on Monday on charges of duping people. Police have seized three vehicles and raided a water bottling plant of the company and their interrogation is on.
The CMD of this non-banking financial company (NBFC) Debesh Kumar Nayak of Bhadrak collected nearly `30 lakh from investors even after the Crime Branch raids, with a promise to return them their deposits with higher interest.
Police said along with the company’s vice-president, zonal manager and a few other officials, Nayak had come to Chandipur on Sunday afternoon and convened a meeting with a few agents and depositors to discuss how to repay the investors.
On a tip-off, hundreds of other depositors rushed there and gheraoed the private hotel in Chandipur where the meeting was on and demanded Nayak to return back their amount. The CMD and depositors had heated argument and chaos prevailed there for a long time till the informed police reached there and took the company officials into custody.
Police raided a drinking water bottling plant of the company at Fakir Mohan Nagar in Balasore. The company was trading bottled drinking water under 'Cheers Water' brand. It is also learnt that the bottling plant was functioning without having any requisite quality control certification.
The depositors and agents alleged Mid East company had mobilised over `100 crore from the State and its investors were mostly from Balasore, Bhadrak and its neighbouring districts.
"After the Crime Branch raid, Nayak had promised them to return their money. One day, he approached us to give Rs 30 lakh assuring that he would return our total maturity amount as he would get `15 crore from one source if he deposits the money. Accordingly, we gave him the amount, but he did not keep his promise," one of depositor alleged.
Police said a number of complaints had been lodged against the company for allegedly duping people. While two vehicles of the CMD were seized from Chandipur, another was seized from Bhubaneswar on Monday.