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Financial fraud: Rs 20,000 crore in 5 years... have these Pune firms got your money?

A combination of ready cash and scamsters using extremely high returns to draw in investors has led to a huge spike in financial fraud. With online pitches and even banks getting drawn it, investors across the state and in Pune are being bled dry of cash

pune Updated: Jun 26, 2018 16:06 IST
Nadeem Inamdar
Nadeem Inamdar
Hindustan Times, Pune
DSK,fraud,BoM
Investors affected by the DSK scam gather at Chittaranjan Vatika in Model colony on Sunday.(HT photo)

PUNE Financial frauds estimated to be over worth Rs 20,000 crore have been reported in Pune in the past five years as per statistics from the economic offences wing (EOW) of the Pune police. The figure assumes significance as the majority of the scams are investors frauds, where gullible citizens have been duped on the promise of high returns on invested amounts. With more than 120 cases of economic fraud registered in 2018, the EOW and the city police have arrested more than 500 offenders.

The big shocker in one of the major frauds afflicting city investors, the DS Kulkarni case, is the arrests of top officials of the Bank of Maharashtra and a financial audit in the case which alleges six nationalised banks broke RBI rules to fund DSK.

Forensic auditor and financial crime expert Shekhar Sonalkar said, “The crimes involving banks are of a serious nature and forensic auditing nails their criminal activities.The banks must realise that they are custodians of people’s money where the majority stakeholder is the government . Forensic audit is submitted and accepted as evidence before the court, ” he said.

Nilesh More, assistant commissioner of police (EOW cyber crime., ACP ), said that the economic frauds are happening due to the changing nature of development in the metropolitan region, where digital technology is ruling the roost. “Criminals have easy access to technology which makes it easy for them to commit fraud and escape. The EOW is now focusing on the core area of economic crimes which have increased manifold. Big EOW cases like DSK are on the table. These involve large sums and are being investigated by the EOW. At the same time cyber crime has also been given priority ,” he said.

A J Khan, retired chief commissioner of income tax said, “Citizens must be aware about where they are investing money. At the same time, the police department must be trained in specialised fields like detecting online cyber crime and economic frauds with the aim of keeping cyber and economic criminals on a tight leash.”

ACP More, however, believes the EOW is in step with the crimes. “We have been successful in giving justice to citizens in the recent past and look towards more enhanced and improved economic crime-related policing in the days to come.”

The scams include land deals, cyber crime and online frauds .

Co-operative banks, too, are on the radar of the police on charges including forgery, breach of trust and manipulation of bank records, according to police officials.

Citizen activists monitoring the rising trend of economic crimes said that considering the phenomenal increase in population, rapid urbanisation, growing volume of financial transactions through the internet, the creation of a citizens’ economic crime prevention taskforce under the guidance of the state government is a necessity.

The major scams in Pune include, the D S Kulkarni fraud estimated to be worth over Rs 2,043 crore, involving as many as six nationalised banks who openly flouted all guidelines of the country’s apex bank, the RBI; a Rs 400 crore rose-plotting scam; and Amit Bharadwaj’s bitocoin Ponzi scheme, worth Rs 2,000 crore; all unearthed by the EOW - after major investor pressure.

Rajashree Gadgil, convenor-member of Royal Twinkle Citrus investors’ forum, claims that initially EOW officials did not entertain investors affected by such scams. “ More than 10,000 depositors have been affected by the scam which runs into thousands of crores of rupees. Right now things are moving on the right track and the main accused has been arrested in the case ”. Gadgil herself was an agent-investor in the multi-level-marketing system of Royal Twinkle.

The Royal Twinkle Star Club and Citrus Check Inns scam is over Rs 8,000 crore and it top office bearers are currently in EOW custody .

Jitendra Narayan Mulekar (65), a resident Kothrud, alleged that DSK Group of Companies run by DS Kulkarni duped him for Rs 4,40,647. “An FIR has been lodged at Shivajinagar police station where the duo has been booked under relevant sections of the Indian Penal Code (IPC) for cheating and criminal breach of trust,” he stated.

RTI activist Vijay Kumbhar who has been fighting for transparency and accountability in the banking sector said that financial transactions in a scam form a web of intrigue and need to be unraveled with professional dedication, honest and sincerity of purpose by the investigators.

Sanskar Investor scam is at Rs 100 crore. Sai Prasad Group of Companies fraud is at Rs 4,000 crore. The Maple Group fraud is worth Rs 400 crore, while the Q Net multi-level scam is worth Rs 2 crore. The Janta Sahakari co-operative bank fraud is Rs 5 crore and the Defence personnel co-operative housing society scam is worth Rs 3,500 crore according to the police.

First Published: Jun 26, 2018 15:44 IST