RBI gears up for inquiry on 194 small chit fund entities in Bengal

Central agencies like Enforcement Directorate (ED), Central Bureau of Investigation (CBI) and Serious Fraud Investigation Office (SFIO) are already conducting thorough probes against giant chit fund entities in West Bengal like Saradha Group and Rose Valley Group.

Kolkata: The Market Intelligence Wing (MIW) of the Reserve Bank of India (RBI) is gearing up for initiating a fresh enquiry against 194 small and micro chit fund entities who have been active in West Bengal since the end of 2015.

Central agencies like Enforcement Directorate (ED), Central Bureau of Investigation (CBI) and Serious Fraud Investigation Office (SFIO) are already conducting thorough probes against giant chit fund entities in West Bengal like Saradha Group and Rose Valley Group.

A senior apex bank official said on condition of anonymity that in November 2016, for the first time RBI cautioned West Bengal government on these 194 chit fund or multi-level marketing (MLM) entities. At that point of time, the apex bank forwarded all details relating to these 194 entities to the state secretariat of Nabanna.

In the fresh initiative, the apex bank will enquire whether the state government has taken any initiative against these entities. The central bank will also enquire whether the state government has any additional information about these entities.

“In size or in terms of the extent of fund mobilisation from the market, these 194 entities are simply dwarfed when compared to Rose Valley Group. At least that was what they were during the financial year 2016-17. But a dwarf can become a giant in absence of proper monitoring and action. In November 2016, when the apex bank handed over details about these 194 chit fund entities to the state government, the latter was also cautioned that in absence of action any of these chit funds in future can become masterminds of major financial scams like Saradha or Rose Valley. We hope that the state government has taken some appropriate action in the meantime,” the apex bank official said.

At the same time, he said that RBI has got the information that among these 194 small chit fund entities some are still clandestinely active. “Our market intelligence wing does a regular scanning of the different classified advertisements in different publications and social media and from that, they have got information that some of them are giving advertisement promising lucrative and absurd returns. But the apex bank is determined to take prompt action against them” he said.

In the fact, the leadership of the ruling party in the state had been apprehending a renewed and more forceful movement by central agencies like ED, CBI and Income Tax department in the coming days.

Only last week, while addressing a public rally, chief minister Mamata Banerjee said that whenever elections approach BJP uses the central agencies to put Trinamool Congress leaders and MLAs under pressure.

“They will do the same thing this time as well. There might be some arrests by the central agencies in the coming days. But I am not scared. Let them get me arrested if they can. I will contest the elections from behind the bars and will ensure Trinamool’s victory,” she said.

Repeated attempts to contact state consumer affairs minister, Sadhan Pande for his comments failed as his mobile phone kept on ringing.