It is a classic case of police authorities avoiding probe in a complaint of financial irregularities against a private company. The Economic Offences Wing (EOW) of Mumbai police has made sure that the alleged unlawful business operations by Future Generali Life Insurance Company and its senior officials went undetected, despite the fact that crores of rupees of its customers could be at stake.
The company is promoted by three entities: Future Group Companies controlled by the Biyani family, Sprint Advisory Services and Participatti Maatchaschappij Graffschaap, a company based in the tax haven of Netherlands.
Sambhaji Jadhav, a resident of Maharashtra’s Satara district lodged a complaint (copy of which is available with The Hindu) with the EOW on June 21 against the Future Generali Life Insurance Company, supplementing it with adequate documents.
The complaint alleged that the said insurance company, by enrolling dubious Multi Layer Marketing (MLM) companies as corporate agents, has been selling ‘ponzi’ schemes faking them as insurance products, mostly to the poor-lower middle class people, tribal population and underprivileged sections of the society, holding out promises of huge returns, inducing them to bring in more members.
The complaint claimed that there were instances wherein a number of insurance policy documents were with wrong addresses, hence en-masse got returned to the origin. Crores of rupees were swindled by the company as there were no liabilities remaining to be paid.
It also showed the swindling of policy holders’ money through fictitious purchase bills of suit-lengths, payment of fictitious service bills for conducting meetings which never happened, advancing money commission/expenses and scheming it off through rerouting. As per the complaint, the window-dressing of the cheated money was through adjusting the expenditure heads of ‘Advertising & Publicity’, ‘professional fees,’ ‘printing and stationery,’ and ‘travelling.’ The complaint pertains to various offences committed by the insurance company and its officials cognizable under the IPC & Prize Chits & Money Circulation Schemes (Banning) Act of 1978.
The complaint against the company and its officials was filed with EOW of Mumbai Police, as the company office is located in Mumbai. But unwilling to undertake investigations, the EOW officers transferred the complaint to the Superintendent of Police of Satara district, since the complainant was a permanent resident of Satara.
Irked by the never-heard-before move of Mumbai police, Mr. Jadhav wrote back to EOW making it clear that ‘the seat of the fraud and the directing minds of the fraud are in Mumbai, and given the specialization of EOW of economic offences, it’ll be in th fitness of things to have the probe done in Mumbai.’
Following this failed attempt, EOW chose another entity to pass on their responsibility. When The Hindu spoke with a senior official from EOW about the complaint, he informed that the complaint has been sent to Insurance Regulatory and Development Authority (IRDA), “We cannot investigate the case as insurance companies are regulated by IRDA. They are competent to probe the allegations,” said the officer.
“If a bank commits a fraud, do police officials wait for Reserve Bank of India to investigate? IRDA is a regulatory body, but if financial crime seems a possibility prima-facie, the EOW should have at least investigated the case,” said Mr. Jadhav. Given the actions of EOW, the complainant expressed its fear that the probing agency is trying to avoid its responsibilities, in thoroughly investigating the complaint. The complainant is also considering filing of a Public Interest Litigation (PIL), seeking an appropriate writ from the High Court, so as to ensure the guilty doesn't go free of legal prosecution.
Meanwhile, the complaint filed by Mr. Jadhav against Future Generali Life Insurance Company is not the only one against this company. Rajya Sabha member Tapan Sen on June 27 wrote a letter to the Secretary of Ministry of Finance, seeking his intervention in the inquiry of financial irregularities of the said company. In his letter, he made it clear that he, in the past, had informed IRDA of specific inputs of the regulatory scamming, perpetuated by the company through its owners/ promoters.
When asked about the various allegations leveled against the company, it responded claiming no knowledge of any such complaint against it and made it clear that EOW has not approached them. “The company abides by all the rules and regulations framed by IRDA and other regulatory statutory authorities. It would not be possible to comment on the broad level allegations in the absence of any specific complaint at our disposal,” said the company response via- e-mail.