PACL fraud: Investors will protest outside SEBI office

Mubarak Ansari
Tuesday, 13 February 2018

Pune: City-based organisation Janlok Pratishthan will organise a protest outside the Securities and Exchange Board of India (SEBI) office in Mumbai on February 26, after the capital markets regulator failed to refund money of Rs 6 crore to investors who were duped of Rs 45,000 crore by PACL company (erstwhile Pearls).

Pune: City-based organisation Janlok Pratishthan will organise a protest outside the Securities and Exchange Board of India (SEBI) office in Mumbai on February 26, after the capital markets regulator failed to refund money of Rs 6 crore to investors who were duped of Rs 45,000 crore by PACL company (erstwhile Pearls).

“The Supreme Court (SC) ordered SEBI to disburse the amount collected after auctioning properties of the company in six months in 2016 but still nobody has been paid. SEBI should be closed down as it has failed to uphold the rights of the investors. People are not able to fill online forms to claim the amount. PACL has got a large number of properties which can be sold to pay the investors. But SEBI officials are not selling the properties at market value thus they are getting only a fraction of the whole amount required,” said Sunanda Kadam, Chairperson of Janlok Pratishthan, based in Hadapsar. They also filed a petition in the apex court in 2016.

PACL collected money from crores of investors allegedly through unauthorised collective investment schemes, also called Ponzi schemes, in the name of real estate projects. Multiple agencies including the CBI are investigating the cases.

According to the CBI, which arrested the chairman and managing director Nirmal Singh Bhangoo and others, the company raised investments by issuing bogus land allotment letters.

“On being directed by the High Court of Punjab and Haryana to wind up the scheme and refund the investors, a similar fraudulent scheme was operated under the name of second private company. Funds collected from investors of this second company were used to repay the earlier investors of the first private company to stave off criminal prosecution. Funds were raised by the two companies through a vast network of lakhs of agents who were paid hefty commissions. The accused persons illegally collected huge funds of Rs 45,000 crore from Rs 5.5 crore investors under the garb of sale and purchase of agricultural land. These schemes were running illegally and both companies were allegedly engaged in fraudulent activities including forgery in their day-to-day operations. The accused persons fraudulently diverted the funds collected under the aegis of Jaipur-based private company for purported investment in Australian companies,” CBI chargesheet states.

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