The recent arrest of a chit-fund owner, on charges of cheating investors, seems to have blown the lid off one of the biggest chit fund scams the city has witnessed over many years.
Gireesh Babu of Eroor, running a chit fund company named Friends Enterprises, was arrested by the Maradu police last week.
According to officials, Gireesh, a head-load worker till 16 years ago, started off a festival-season chit fund with a capital of Rs.60,000. Over a period of time, he gained the investors’ confidence and opened more schemes with options of daily, weekly and monthly deposits.
Not a registered firm
Investigations revealed that Friends Enterprises, run by the accused was, not a registered chit firm. “Babu had registered another company to run chits with permits issued by the department. He, however, had more investors with Friends Enterprises’’, officials said.
A few years later, he ventured into money lending against promissory notes, blank cheques, title deeds, RC book of vehicles. However, the launch of Operation Kubera upset his plans to expand the activity while some of his debtors even refused to repay the money under cover of the drive.
“Last year, when Operation Kubera was launched, the money he had given to others was not returned. Thus, he faced financial trouble and failed to repay the money to depositors. Following this, Gireesh went absconding and was roaming in different parts of the country’’, officials added. He arrived in Kochi recently and the police nabbed him from a lodge in Thopumpady following a tip-off
While lending money, he always ensured to collect blank cheques signed by the borrower, in addition to RC books and title deeds. The police have already verified about 2,000 RC original books, 4,000 blank cheques, 2,000 promissory notes and about 100 title deeds.
The Maradu police have so far received about 25 complaints against the accused. There are several depositors who are yet to lodge complaint against the firm, including some who had deposited several lakhs of rupees, the officials held.
