NEW DELHI: With as many as 5,85,40,150 investors, siphoning of over Rs 49,000 crore and unidentified plots of land, the PACL Ponzi scheme, which is beginning to explode into a scam far bigger than West Bengal’s Saradha scam, has now reached the court of law. The Securities and Exchange Board of India (Sebi), armed with the order of Securities Appellate Tribunal (SAT), has filed a criminal case against the ponzi company in a bid to recover the hard-earned money of investors.
“A criminal case has been filed against PACL ponzi scam seeking maximum punishment to the masterminds and to recover the money. January 21, 2016, has been fixed for the hearing of this case,” A Sebi Official confirmed.
According to Sebi, in the guise of selling agricultural land, PACL has collected Rs 49,100 crore from 5.85 crore customers by promising them that the investments in the schemes of PACL are highly profitable. Sebi’s investigation report said PACL had collected Rs 44,736 crore till March 31, 2012. Further, the company collected Rs 4,364.78 crore from 39,97,357 customers during the period February 26, 2013 to June 15, 2014.
“The total amount mobilised comes to Rs 49,100 crore. This figure could have been even more if the company had provided details of funds collected during April 1, 2012, to February 25, 2013—the 11 months period missing from record,” the Sebi said.
The regulatory body said plots of land are not identified either in the application form-cum-agreement or in the registration letter — the primary documents — and PACL has designed the schemes in such a way that customers will never ask for possession of its plot of land from the company.
Sebi said the firm had refused to comply with its directive and a show-cause notice was issued on June 14, 2013. On August 22, 2014, Sebi directed the PACL to wind up all schemes and refund monies collected from the investors with the return which are due to its investors within three months.
A Sebi official said instead of complying with the order, PACL challenged it in the SAT which in its order on August 12, 2015 upheld the market regulator’s position.
SAT in its order said the company was liable to refund money collected in unauthorised manner within three months from August 12, 2015. It also noted that permitting PACL to operate collective investment scheme by seeking registration under CIS Regulations would be s travesty of justice. “The pariod of three months expired on November 11, 2015, however they have not refunded even the monies collected, forget promised return. In such a situation Sebi had no other option but to move court seeking justice for investors,” the official said.
The offence under Section 24 of Sebi Act is punishable with imprisonment for 10 years or fine which may extend to Rs 25 crore. The regulator would also “make a reference to the local Police to register a civil and criminal case against PACL, its promoters, directors and managers in-charge of the business and its schemes, for offences of fraud, cheating, criminal breach of trust and misappropriation of public funds,” said the Sebi order.