Ponzi scheme revealed
Uttar Pradesh’s Economic Offex Wing (EOW) on Thursday arrested Gurnam Singh (69), director of Pearls Agro-Tech Corporation Limited (PACL) from Rupnagar district of Punjab. According to the Times of India report, Gurnam Singh is accused of raising about 49,000 crore rupees in the name of investment in land from about 5 crore people in about 10 states and it is one of the biggest scams in the country.
CBI, ED tightened grip
The Central Bureau of Investigation (CBI) and the Enforcement Directorate (ED) have already registered cases against PACL. This action was taken after the complaints of investors and investigation by the Securities and Exchange Board of India (SEBI). On the basis of all this, a separate case was also registered at EOW police station of Kanpur (case number 1/18). The FIR has a total of 10 people including Gurnam Singh, out of which four are already in jail. The search for the remaining accused is still going on.
Gurnam Singh’s role in PACL
According to EOW officials, PACL founder Nirmal Singh Bhangu (now late) made Gurnam Singh a director. Officials said that this thing is clearly recorded in the company’s papers. It is alleged that Gurnam Singh played an important role in spreading the scam by running financial activities without permission in many states including UP.
How did scam
PACL started in Jaipur in 1996 under the name Guruvant Agro-Tech, which was changed to PACL in 2011. The company started collecting large scale money without the required NBFC registration under Section 45 of the Reserve Bank of India Act, 1934.
PACL opened several branches in Mahoba, Sultanpur, Farrukhabad and Jalaun in UP. Here people were given the deception of giving land and rough returns in the name of installments and fixed deposit schemes. EOW official said, in UP itself, the company collected more than Rs 19,000 crore from the public and in return only gave bond receipts nor land nor returns.
Ponzi scheme revealed
Eow’s DG Neera Rawat told that PACL was actually acting like a Ponzi scheme. By luring more returns, the company joined people with them. Like the pyramid scheme, every man would be asked to add two more people. The agent used to get a thick commission, so he also used to add his relatives and friends. The company also provided many seminars so that more people get trapped.
ED check and charge sheet
The Enforcement Directorate (ED) is also investigating the scam and recently filed a supplementary charge sheet in the special PMLA court of Delhi. Investigation revealed that investors’ money was rotated in shell companies and assistant firms. These include M/S MDB Housing Complex, which Harsatinder Pal Singh, son -in -law of PACL founder Bhangu, was controlling Higher.
ED reported that Higher was arrested on 21 March and is in judicial custody. It is alleged that Higher bought property in Mumbai, Punjab and Haryana with the money of this scam and kept showing them as valid assets.
How PACL scam started
The scam was started by Nirmal Singh Bhangu, who is a resident of Barnala, Punjab, where he used to do milk business. It started the land investment scheme by working in companies like Golden Forest India Limited. The company claimed that it would buy land for farmers and commercial work and would give big profits to investors. But in fact, investors got only bond receipts, land did not get anything.
How many people affected and further action
According to EOW, about 50 lakh people in UP have been affected by this scam. PACL also implicated people in Assam, Punjab, Rajasthan, Delhi, Madhya Pradesh, Andhra Pradesh, Kerala, Bihar and Chhattisgarh. Now after the arrest of Gurnam Singh, EOW and other agencies are busy in catching the remaining accused and seizing the property.