Another IT firm shuts shop, defrauds employees

CHEATED: Employees, mostly from the smaller towns in Andhra Pradesh and Tamil Nadu, were enticed into the job. File Photo: K. K. Mustafah

CHEATED: Employees, mostly from the smaller towns in Andhra Pradesh and Tamil Nadu, were enticed into the job. File Photo: K. K. Mustafah  

Police send teams to AP, TN to track the proprietors

Like a recurring virus, yet another case of employment fraud came to light last week in the IT sector. This time, Maxcom Inc., logged out, leaving 128 employees — mostly engineering graduates and industry freshers — in the lurch.

Sadly, for these youngsters, it isn’t just the question of where their next pay cheque will come from. The company has also vamoosed with the hefty ‘fixed deposits’ ranging from Rs. 1.2 lakh to Rs. 1.4 lakh that each of them had forked out at the time of joining.

Employees, mostly from the smaller towns in Andhra Pradesh and Tamil Nadu, were enticed into the job which offered training and a starting pay of Rs. 20,000. Most of them were recruited through job consultants — currently untraceable — in Andhra Pradesh and Tamil Nadu. Taking these deposit amounts into account, the total extent of the fraud is estimated to be over Rs. 1.5 crore.

Overnight closure

Employees who spoke to The Hindu on the condition of anonymity, said the owners shut shop a day after some of them questioned why none of them was assigned any projects. The next day they found the place locked, the keys returned to the owners and the name boards removed. They then filed a complaint with the Koramangala police.

Three arrests

The police have arrested three persons: HR manager Rakesh Pandey, project manager Naveen and job consultant Sujatha. However, the real culprits are the two proprietors of the company, Ravi Prakash and Prakash Reddy, who are absconding. A Bangalore police team tracked them to Chittoor (Andhra Pradesh) on Wednesday, and is at present monitoring their movements in Tamil Nadu, Police Inspector Sudhir told The Hindu. Employees claim that Ravi Prakash’s real name is Phani Nimagada and he runs many such consultancies.

The employees claim that all applicants from Karnataka were rejected. A majority were recruited through job consultancy firms — three of which were co-owned by Ravi Prakash — in Andhra Pradesh.

They were recruited in two batches in March and May. A batch of 40, recruited in March, completed training and got their first pay cheque of Rs. 19,000 in June.

However, none of them was given a project to work on, and this led them to suspect the employers. “Why would they hire 80 more when the first batch itself had no projects? When we questioned them, they told us the projects were ready. The next day they vanished,” an employee said. The second batch was being trained in a two-room facility to keep them isolated from the older batch. The training was in basic computer languages.

Condoned practice

A majority of those cheated have taken loans and even mortgaged property to pay the deposit. Some are 2010 graduates who were unable to find a job and went along with the “fixed deposit” demand to get a toehold in the industry. Recruitment from tier-II and tier-III colleges has been low in recent years, ever since the economic downturn in 2009. Paying deposits, sometimes called training fees, to get a job in this booming sector, is an accepted practice, many said. Afraid that they will be blacklisted if they complain, some of them have returned home. The complaint submitted to the police was signed by 82 employees.

Not a one-off case

Police officials who spoke to The Hindu said cases of job fraud by IT companies are aplenty, but grossly under-reported. Last year, the Koramangala police had cracked a case where a company had defrauded around 1,000 employees. Earlier this year, IT Employees Centre had launched an awareness campaign among IT workers on this issue after three such cases had come to light.

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Printable version | Jul 6, 2020 5:08:18 AM |

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