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Another Financial Fraud Comes to Light

The members of an action council have alleged that Rajashree, a private financial firm, have cheated around 50,000 people

Published: 21st February 2014 08:33 AM  |   Last Updated: 21st February 2014 08:33 AM   |  A+A-

The members of Rajyashree Action Council have said that the promoters of Rajyashree have cheated around 50,000 people in Ernakulam, Thrissur, Kottayam and Idukki district. Though they approached the Kerala State Legal Services Authority (KELSA) in November last year, the chances of getting their money back is still bleak, Action Council members alleged at a press conference here.

It is said that, Rajyashree, a collective recurring deposit scheme with mediclaim and loan availing facility, has collected over `15 crore in 12 years.  “The firm became operational in 2002. The promise by the promoters was that the profit on the investment and interest will be paid to the members after five years. Women belong to the lower economic strata of society were the main agents of Rajyashree. The firm sprouted and the number of agents soon became 600. They collected money in the range of `100 to `10,000 from people, the majority of them were in the lower income group category, from the four districts. Everything was smooth till December 2010. But then things started falling apart and many people did not get their money back. The members lodged complaint against the firms in various police stations but nothing happened so far,” said George Rajakkad, secretary  Rajyashree Action Council.

The promoters had told them that the firm was getting money from overseas and the investment of the people were well protected, the Action Council members said. Rajyashree operated in the central districts of the state from Angamaly.

Kuriakose Madavana, an agent of Rajyashree, said that the investors were not getting any money since January 2102. “The agents are being threatened by the investors. When the promoters were called into the police stations, they stated that there are no assets in their name,” he added. “We had approached KELSA as the last resort. There they assured that the company has 9.5 acres of land at Rajakkad, Idukki and the dues will be settled by selling the land. But, the land could not be sold because of the liability the promoters have made in the bank,” George Rajakkad said.

The promoters of Rajshree were not available for comment.

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