Kolkata liquor baron, 3 others held in Rs 56 crore scam

JAIPUR: A Kolkata-based liquor baron and three of his aides were arrested by the special operations group (SOG) of Rajasthan police from Bangalore on Friday in connection with a multi-crore investment fraud case.
The accused had raised Rs 56 crore illegally from over 25,000 people in Rajasthan. In violation of RBI and SEBI guidelines, the accused had also raised Rs 1,600 crore from over three lakh investors from states such as Gujarat, Madhya Pradesh, Bihar, Haryana and Uttar Pradesh.The SOG arrested Manoranjan Roy, chairman of Pincon Spirits Ltd, and his associates Raghu Shetty, Binay Singh and Hari Singh.
Roy had set up multiple shell companies like LRN Finances, ASK Financial Services, Greenage Food Products Ltd, Bengal Pincon Housing Infra Ltd, LRN Universe Private Ltd and Universal Multi-state Credit Co-operative Society to cheat people.
SOG inspector general (IG) Dinesh M N said these NBFCs were shell companies which never fulfilled their objectives stated under the articles of association (AOA). "Roy had set up 11 branches in Rajasthan. The first branch was opened in 2010 in Ajmer. They raised money through 'private placement' in violation of RBI norms which mandates that only 49 investors can invest in the company. Similarly, debentures were floated at 14% for four years by these shell companies to dupe investors," Dinesh said. The investors' money was siphoned off and moved into the accounts of Pincon Spirits Ltd, a public listed company. "The money of investors was siphoned to the Pincon. However, once the debentures matured, they told investors that their money has been 'reinvested' in another company. The investors were offered fake intensives to justify the 'reinvestment'. But the company in which the money was reinvested was liquidated by them," said SOG SP Sanjay Shrotriya.
For example, LRM Finances raised Rs 31 crore from investors. While Rs 7 crore was returned to investors, about Rs 24 crore was illegally routed to Pincon. "Of Rs 56 crore raised illegally, Rs 7 crore has been returned in small amounts and Rs 39 crore has been siphoned off," said an official. The SOG has written to ED, RBI, SEBI and CBI to look into the matter.