Trader’s death puts glare on fraud finance agencies in Uttarakhand | dehradun | Hindustan Times
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Trader’s death puts glare on fraud finance agencies in Uttarakhand

A trader’s death in Haldwani has put spotlight on unregistered non-banking financial agencies and lack of regulation of their operations in Uttarakhand

dehradun Updated: Jan 24, 2018 21:44 IST
Abhinav Madhwal
People take loans on high interest rates from the committees, or deposit money in them lured by promised handsome returns, police say.
People take loans on high interest rates from the committees, or deposit money in them lured by promised handsome returns, police say.(HT File)

A trader’s death in Haldwani has put spotlight on unregistered non-banking financial agencies and lack of regulation of their operations in Uttarakhand.

The trader was found unconscious on Monday and after a few hours he died. Police suspect that his death is linked with financial dealings with non-banking agencies, locally called ‘committees’. People take loans on high interest rates from the committees, or deposit money in them lured by promised handsome returns.

In 2015, a committee operator ran away from Premnagar area of Dehradun with around Rs 2 crore deposits. In 2014, a committee operator had duped people of around Rs 2 crore and fled from the city after selling his house. Recently, an operator from Rajpur Road area refused to give money to depositors after maturity.

“The committees were a traditional system of collection of money and its disbursal for mutual benefit. With the passage of time, discrepancies have crept in, and criminal elements have used the committee system to their advantage,” said Ashok Kumar, additional director general of police (law and order).

The committee business, though unregistered, has spread its tentacles in the city. Committees are not are not registered as non-banking financial companies and hence not authorised to promise high returns; they take advantage of gaps in legal provisions to push their business. Growing cases of innocent people being cheated by firms through Ponzi schemes have been reported in the country.

“Yes, there have been serious frauds on this front. When people promise doubling of money within a short span of time, investors must be cautious,” said Kumar. “Police will take action if such operators dupe people. If investors are suspicious of some operator, they can inform the police.”

Social activist Raghunath Negi said the banking system must be strengthened to prevent such frauds. “Banks do not give loans to people who are not salaried; they often go to committees, which then exploit them.”

Mahesh Sajwan of Bakralwala area, whose money is stuck in a committee, said he deposited the amount on trust as the operators had been living in his locality for a long time. “I will advise people to not fall in the grip of committees as they have no legal sanction and can dupe investors any time.”