VIJAYAWADA: Hours after AP CID chief N Sanjay sought investigation by Central enforcement agencies into the alleged Margadarsi chit fund scam, the firm had claimed that the allegations made by the officer were ‘astonishing fabrications’ and they would initiate legal action to protect their interests.
In an official statement, Margadarsi Chit Fund Private Limited (MCFPL) said Sanjay made dramatic allegations that the CID “is in the process of preventing one of the biggest financial frauds ever seen in the name of chit fund operations by exploiting the weak and innocent subscribers.”The statement said MCFPL is India’s largest chit fund company with over two lakh chit subscribers in the two Telugu States.
“Ch Ramoji Rao who founded MCFPL 60 years ago is also the Founder-Editor of the largest circulated Telugu daily, which is known for its independent and sometimes critical reporting on the functioning of Andhra Pradesh government headed by Chief Minister YS Jagan Mohan Reddy,’’ the company stated.
MCFPL was targeted by the State government in a thinly disguised attempt to tarnish and destroy its reputation through inspection of 17 branches last November by the Registrar of Chits under the Chit Fund Act, 1982.
“The chit security deposits of the company with the Registrar, which ought to have been refunded on completion of chits, have been retained by the Registrar. The total amount of such refunds that have been held up amounts to Rs 48.81 crore as on date despite closure of respective chits,’’ MCFPL said.
It further added that explanations were asked by the jurisdictional Registrars for alleged violations of the Chit Fund Act.“These were duly provided by MCFPL, but were brushed aside,’’ the statement said.MCFPL said seven FIRs were registered, three branch managers and a reputed auditor were arrested and remanded to judicial custody.
Apart from this, MCFPL alleged that subscribers of the company chits were contacted and threatened with dire consequences if they failed to sign certain complaints against the company, the content of which was given to them. It said a photograph of Ramoji Rao being examined in bed by the CID was taken and published in a section of the media in total violation of his privacy.
“The AP CID has declared it spent two days in Delhi to brief the Central enforcement agencies of illegal activities such as money laundering, siphoning of funds, corporate frauds, helping ghost subscribers to indulge in benami transactions and evasion of income tax. There can be no falsehood more blatant than these allegations. Clearly, the object of the entire exercise is to financially cripple the company, intimidate the management and staff and cause panic among subscribers,’’ the company stated.