Rose Valley chit fund scam: Restitution of funds to investors begins, over 7,000 victims get money
Times of India | 5 October 2024
NEW DELHI: A first-ever restitution of funds to the duped investors of the Rose Valley alleged fraud has finally begun with more than 7,000 people receiving Rs 10,200 each. The Asset Disposal Committee (ADC) handed out the funds to the first set of people in Kolkata on Thursday, the Enforcement Directorate (ED) said in a statement.
In the first phase of this restitution process, 7,346 depositors received a total of Rs 5.12 crore.
The move follows an August order from the special Prevention of Money Laundering Act (PMLA) court in Kolkata, enabling the release of Rs 19.40 crore to the ADC.
"The first phase of the long-awaited restitution process has begun, with 7,346 depositors receiving refunds at a rate of Rs 10,200 per claimant, totalling Rs 5.12 crore in the disbursed fund," the federal probe agency said.
The move to restitute or return the funds to the duped investors and victims of frauds like Ponzi, chit fund and fake investment schemes came about after a special Prevention of Money Laundering Act (PMLA) court in Kolkata ordered for the same in August, enabling the release of Rs 19.40 crore to the ADC, marking the beginning of a "systematic repayment plan".
Justice Dilip Kr Seth (Retd.), ADC Chairperson, praised the cooperation between the ADC and the ED at a fund disbursement event. He noted, "The continued cooperation between the ADC and the ED, underscoring the ED's critical role in identifying and attaching the properties of the Rose Valley Group.
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"This collaboration has been instrumental in overcoming legal challenges posed by Rose Valley promoters and convincing the court of the merits of the claimants' case, ultimately paving the way for successful efforts for restitution," the agency said.
"The Rose Valley Group collected funds from the common gullible public by floating fake and fictitious schemes and defaulted on the re-payments," the ED had said earlier.
Under section 8(8) of the PMLA, the court can restore confiscated property to claimants who suffered losses due to money laundering. The restitution process will continue as more claims are validated.
The ED noted, "These funds, along with future recoveries, are being disbursed on a 'pro-rata basis' or as otherwise directed by the special PMLA court.
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28.10 lakh claims registered
The ED has booked a PMLA case against the Rose Valley group, its chairman Gautam Kundu, and others since 2014. Gautam Kundu was arrested in March 2015 and remains in judicial custody. The Rose Valley Group allegedly defrauded the public by collecting funds through fake schemes and failing to make repayments.
Movable assets worth Rs 494 crore and immovable properties valued at Rs 1,069 crore -- spread across West Bengal, Odisha, Assam, and Tripura and West Bengal -- have been attached by the ED as part of this probe done under the anti-money laundering law.
A total of 28.10 lakh claims have been registered, out of which 31,352 claims have been processed and 7,346 depositors have now received the money.
The restitution process is expected to continue over the coming months as more claims are scrutinised and validated by the ADC. This initial phase highlights the commitment of the ADC to ensure prompt justice for defrauded investors and restoring their lost funds, it said.
The process to restitute the assets of the innocent investors was ordered by the court under section 8(8) of the PMLA which says that if a property has been confiscated by the central government (by the ED under the PMLA), the special court has the power to direct restoration of the confiscated property to a claimant who has a legitimate interest in the property and has suffered a quantifiable loss as a result of an offence of money laundering.