After the release of a list of 72 bogus chit fund investment companies by Government of India, Corporate Affairs Minister Sachin Pilot, last week, there has been a widespread panic among investors who rushed in to get back their deposits. The list included several prominent names like the Rose Valley group, Vibgyour, MPS Greenery, Prayag, Rahul, URO and others.
The release of such a list which includes the names of such chit fund companies, who have collected crores of money from people all over India, created panic not only among depositors but also among banks and financial institutions who are linked with this bogus chit fund companies.
One of the most prominent chit fund companies of Bengal, Rose Valley, after being denied any further financial assistance by Axis Bank, started issuing ‘chits yesterday, to depositors in Durgapur, delaying refund for another three months. This created a much hue and cry among the depositors who have been queuing up in front of Rose valley branch offices in Durgapur from last week.
Axis Bank’s Airport branch in Kolkata, its nodal office for chit fund related businesses, had cautioned Rose Valley authorities to look for alternative arrangements as it was not interested for any financial transaction with the company beyond 30 April. Despite this, the company continued offering Axis Bank cheques to some depositors who thronged the company’s City Centre and Benachity branches in Durgapur yesterday.
Most depositors, however, were issued chits bearing the official seal of the company, which stated August 2013 as the date of payment.
Mr Abhijit Majumdar, Rose Valley branch manager at City Centre, said: “We have issued nearly 6,500 number of such slips to the depositors against submission of the photo copies of their respective premature policy papers.” He added: “Axis Bank had warned us not to issue any cheque bearing dates beyond 30 April. Accordingly our Midnapore regional office ordered us to issue such slips to help identification of depositors, who would be disbursed their due amount after deducting a percentage from the principal amount.
Meanwhile, Rose Valley officials said, that the company has been trying to rope in Bank of India to wriggle out of the crisis.