The Central Bureau of Investigation has pointed to the involvement of some Enforcement Directorate officers in the Rose Valley chit fund scam—believed to be one of India’s biggest financial frauds— and has suggested that the ED inquire into this, CBI sources told News18 on Friday. The scandal first hit the headlines in 2013, and, as per some ED estimates, the Ponzi company raised around Rs 17,500 crore from investors mainly in West Bengal, Assam, Bihar and Tripura. A few reports pegged the amount at about Rs 60,000 crore.
In a letter to the vigilance department of the ED, the Central Bureau of Investigation has provided the names of several officers who may have direct involvement in the financial scandal. A few days ago, at a high-level meeting at the CBI headquarters in Delhi, it was decided that the pending cases pertaining to state chit fund companies, including Saradha and Rose Valley, should be disposed of and final reports submitted as soon as possible. For that reason, the agency’s core investigating team too was restructured.
This is not the first time that allegations have surfaced against some officers of the ED investigation team in the case. Earlier, Manoj Kumar, a senior officer of the agency, was accused of providing certain benefits to Shuvra Kundu, wife of Gautam Kundu, the owner of the Rose Valley firm. Kolkata police also arrested Kumar in a case of cheating and extortion, though he was later granted bail. He and several other ED officers were also questioned by the CBI during its probe into the case.
According to investigators, a portion of the money in the Rose Valley scam was also used to bribe politicians in a bid to cover up the case. The firm had floated the scheme promising inflated returns on investments, between eight and 27 per cent, to investors. Rose Valley also allegedly made “cross investments" in various sister firms in an attempt to suppress its liabilities towards investors. The Securities and Exchange Board of India (SEBI) had investigated the company before the CBI and ED registered cases.
In 2015, Rose Valley chairman Gautam Kundu was arrested in a money laundering case. A special Prevention of Money Laundering Act (PMLA) court in Kolkata convicted Arun Mukherjee, the director of the chit fund company, in a similar case this February. Several leaders of West Bengal’s ruling Trinamool Congress, including MP Sudip Bandopadhyay and actor-turned-MLA Tapas Pal were interrogated, arrested and jailed in the matter. While Bandopadhyay is out on bail, Pal died last year.