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SFIO To Probe Three More WB Groups

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Amid the raging controversy over alleged fraud by Saradha group, the government has directed the Serious Fraud Investigation Office to probe three more West Bengal-based groups, suspected of defrauding investors through money-pooling schemes.

SFIO has been asked to investigate the affairs of four business groups, including Saradha, which have "raised huge sums of money from the public at large", according to an internal communication.

In all, more than 50 companies will be investigated, including 14 Saradha entities.

The other three groups are Rose Valley, Icore E-Services and Sunshine India Land Developers, as per communication sent by the Corporate Affairs Ministry to the SFIO.

The probe has been ordered pursuant to a report from the Registrar of Companies (RoC), West Bengal.

SFIO has also been asked to identify a team of officers who could be appointed as inspectors to investigate into the affairs of these companies so that formal orders could be issued for their appointment.

The Ministry yesterday decided to set up a Special Task Force under the SFIO to investigate into the alleged fraudulent money-pooling activities of various companies in the name of chit fund schemes.

As per the ministry's direction, the 14 Saradha group entities to be investigated include Saradha Realty India, Saradha Agro Development, Saradha Exports, Saradha Construction Company, Saradha Garden Resorts and Hotel.

Besides, nine entities from the Sunshine India Land Developers group, 11 from the Icore E-Services Ltd group and 19 from Rose Valley group would be investigated by SFIO.

The probe could be extended to more companies, including those from other states, as the investigation progresses, sources said.

Interestingly, most of these companies are not actually registered as chit funds, and their activities are also more in the nature of Multi-Level Marketing, collective investments or other money-circulation schemes, broadly known as 'ponzi' schemes, they added.

Saradha Realty India, one of the Sudipta Sen-led group's various entities, has already been ordered by market regulator Sebi to wind up its collective investment schemes and refund investors' money.

Sebi is also probing some more Saradha group entities and other companies from West Bengal and various North-Eastern states.

A large number of companies from various eastern states, including West Bengal, Odisha, Bihar and Assam, have come under regulatory scanner for alleged defrauding of investors through their money-pooling activities.

SFIO might also need to rope in experts from outside, as the probe could eventually extend to an even larger number of companies.