Pathanamthitta: Popular Finance swindled Rs 600 crore in the Konni area, which includes the finance company’s head office in Vakayar, the police have said. They got the information while collecting details of frauds committed at various branches of the company.
The police have come to know that some of the top officials of the company are in Bengaluru. They have now started an investigation focusing on these officials.
In 2014, the Reserve Bank had taken action against Popular Finance and banned the firm from accepting deposits in violation of the central bank’s regulations.
The company, however, concealed this fact and collected crores of rupees in deposits. They even opened new branches across the country. It then diverted the money.
The Crime Branch had filed a case against Popular Finance for accepting the deposits illegally. The case is in High Court, but the company has been extending it for six years by obtaining stay orders.
Popular Finance will also face action for issuing bonds without the permission of the capital markets regulator Securities and Exchange Board of India (SEBI). The bond was issued in the name of San Popular without any legal protection with the promise of doubling investments in five years.
The company also added investors to another scheme that claimed to double investments in seven years. Most of the victims of this scheme are those who had been accumulating money for marriage and other purposes.
A bankruptcy petition filed by Popular Finance owner Thomas Daniel alleged that fraud by branch managers had resulted in financial loss. The petition also admits that there was financial mismanagement in the company.
A total of eight bankruptcy petitions have been filed in the sub-court on behalf of various entities under Popular Finance, including Popular Exports, Popular Dealers, Managing Partner Thomas Daniel, Popular Mini Finance and Popular Printers, besides Popular Finance itself.
The respondents in the petitions are the company’s 50,000 investors.
