In one of the biggest-ever scams of its kind, Popular Finance, a non-banking financial firm based in Kerala in southern India, has allegedly cheated its depositors of 2,000 crore rupees ($400 million). The special team of investigation led by District Police Chief KG Simon has found that Popular Finance Deposit Fund scam has a connection with Australia.
Established in 1965, Popular Finance Limited was run by the company's managing director, Thomas Daniel, his wife Prabha Thomas, and their daughters Dr Reenu Mariam Thomas, chief executive officer, Reba Mary Thomas and Riya Ann Thomas.
After around 200 complaints were filed against the company, Indian state police intensified the hunt for the company owners.
Police take the accused to their house for giving evidence Source: Manoramaonline
A look out notice was issued against the accused and the board members and the executive of the firm Reenu Mariam Thomas and Reba Mary Thomas were arrested after being restrained at the Delhi airport on August 28th while trying to leave the country. Their parents Thomas Daniel and Prabha Thomas were also arrested on the following day.
The District Police Chief KG Simon confirmed to SBS Malayalam that the sisters were arrested while trying to travel to Australia.
“They were planning to flee to Dubai first and then to Australia where their close relatives reside,” said KG Simon to SBS Malayalam.
“To probe the case that has international links and is under investigation, we will seek the help of Interpol (The International Criminal Police Organization),” added Mr Simon.
Source: Manoramaonline
Investigations by Kerala police have revealed a large amount of money collected from investors being transferred to Australia.
“The state government has informed the High Court of Kerala that the accused have parked a large amount of money to Australia. The state government also suggested the court it would be appropriate for the CBI (Federal investigation agency) to investigate the case that has international links,” regional newspaper Malayala Manorama reports.
Residing in Australia
According to the statement filed by the District Police Chief to the High Court of Kerala, "The close relatives of the arrested accused especially mother, sister and brother in law of Thomas Daniel are residing in Australia. There is every reason to believe that the money they swindled may be parked in foreign banks and foreign countries that too in binami names."
"The involvement near relatives and other associates in this case is to be sorted out," reads the statement filed by police.
As of now over 3,000 complaints are received from depositors from various places and the same is being processed.
The media reports also state that the state attorney has told the court that the investigation team has found that the close relatives of the accused are residing in Australia and that a large amount has been moved to the country.
A month after the arrest of all four accused, the police team probing the case also arrested Riya Ann Thomas, the fifth accused in the case.
One of the offices of Popular Finance Limited in Kerala, India Source: Asianet
Another regional newspaper Mathrubhumi reports that the accused have revealed that five vehicles have been registered in Australia.
As part of the investigation that started a month ago, investigators have also found overseas money transactions. There are reports that 2,900 cases have so far been registered in this case.
The statement filed in High Court also reads, "On investigation, it was revealed that the firm by name Popular Finance Limited has been registered by Thomas Daniel and Prabha Thomas under Indian Partnership Act 1932 for money lending business and they violate the rules of Reserve Bank of India."
Reports say that once CBI takes over the case, investigation will be extended overseas.
The investigation by the Kerala police team alleged that the company owners used investors’ money for personal gains such as buying acres of land outside the state. It is said that the entire amount from the investors was transferred to three establishments.
As per the remand report, the company that had also been offering gold loans shifted the amount collected from the investors to shell companies without their knowledge or permission.
Source: News18
The investigation team has said that the group operated 238 branches in various states across the country and several shell companies.
'Mischievous intention' to deceive investors
"The accused with mischievous intention to deceit the investors across Kerala and India, propagated that the money they invested in Popular Finance Limited fetch an interest rate of 12 percent per annum or yield in double in just seven years, without disclosing the actual dealing in their investments, attracted the probable investors through Branch Managers and Collection Agents of their 238 branches in India, though they were not authorised by law to accept deposit from public," the statement filed by the District police chief to the High Court reads.
The incident came to light after all branches of the firm were shut following an uproar by depositors who tried to withdraw their money.
Meanwhile, the company has said it is bankrupt. The investigation team is in a move to attach their assets to give back the investors’ money. Investors have been staging protests in front of their branches demanding a CBI probe into the case.
Thomas Daniel and wife Prabha Thomas have filed an insolvency petition mentioning that they have a debt of 432 crores rupees.
All accused have been charged on various sections of the Indian Penal Code section 406 for punishment for criminal breach of trust, section 420 for cheating and dishonestly inducing delivery of property and section 34 acts done by several persons in furtherance of common intention. All four accused are in remand, while the fifth accused is in police custody and the investigation has now extended to other states.
Since the case is said to have link with Australia, SBS Malayalam contacted Australian Federal Police, Australian Border Force and Australian Criminal Intelligence Commission to know more about the investigation. However AFP, ABF and ACIC responded saying that they cannot comment on individual matters.
