Odisha chit fund scam: Charge sheet filed against three employees of Zodiac Foundation by CBI

Bhubaneswar, July 3: The Central Bureau of Investigation (CBI), which is probing into the multi-thousand crore chit fund scam operated in the Odisha, has submitted charge sheet against three employees of the Zodiac Foundation, a ponzi firm, in the special CBI court here on June 30, sources in the CBI revealed today.

CBI head office in Bhubaneswar
photo courtesy-pragativadi.com 

The 17-page charge sheet, framed against Dandapani Sethi, Gagan Bihari Behera and Subash Chandra Mahanta of the Zodiac Foundation, was submitted in the court by the investigating officer of CBI SIT BN Samal and senior public prosecutor of CBI KC Mishra.

The CBI had arrested Dandapani Sethi from Phulbani for his alleged involvement in the chit fund scam on May 8.

The charge sheet has revealed that Dandapani Sethi, an employee of Zodiac Foundation, was working in the company’s head office in Bhanjanagar in Ganjam district and had allegedly collected Rs 1,07,64,960 from the investors under various Ponzi schemes.

Prior to this, he was working for SKS Micro Finance at Rairangpur in Mayurbhanj district where he came in contact with Behera and Mahanta in early 2012.

The trio later opened an office of the Zodiac Foundation in Rairangpur area and collected small deposits from the gullible investors promising them high returns on their deposits. Then they started providing loans to some investors whom they made members in the Ponzi company and in return collected 16 percent of the money on the assured loan amounts. After collecting the percentage on deposits on the assured loan, they failed to return either the loan amount or the deposits.

On May 5, 2012, Behera and Mahanta left the company by duping more than Rs 2 lakh from the investors deposits. However, Dandapani continued with its business by opening another branch office of the company in Bhanjanagar and engaged agents by luring them with 10 percent of the profit from the collected amount.

During his operation, he had collected Rs 4,09,860 from 925 persons as membership amount. Out of 925 persons, Rs 64,11,400 was collected from 691 persons as small deposits and advance loan deposits. The total amount collected from the investors by floating various schemes was Rs 68,21,260.

In the meantime, Sethi had returned Rs 54,72,250 to 280 members by providing then advance loan and Rs 1,27,400 to the members who had deposited the amounts to get higher interest but did not want to avail the loan.

The CBI had accused Dandapani for misappropriating a sum of Rs 12,21,610 from the total collected amount of Rs 68,21,260 in the charge sheet.

This apart, the Central investigating agency has also accused Dandapani for cheating Rs 39,43,700 from 411 people by not retrunig their deposited money collected by various Ponzi schemes  and the sum collected on advance loans.

The arrest of Dandapani was made following a complaint lodged by one Brahmananda Pati of Bhanjanagar at the local police station which later handed over all documents to the CBI.

Zodiac Foundation, the chit fund company, is among 44 chit fund companies operating in Odisha against which the apex court had ordered for a CBI probe into the multi-crore chit fund scam.

Sethi had been absconding after the duped investors lodged complaints against him and the company. He wrapped up his business and went into hiding at the end of 2012.

Earlier, Rairangpur Town police had arrested Behera and Mahanta after acting on a case (58/2013) registered by it following a complaint lodged by duped investors against the duo. Later both the accused were freed from the jail after the SDJM court of Rairangpur granted bail to the duo.

The senior public prosecutor of CBI said during investigation it was also found out that Zodiac Foundation, a ponzi company registered under society’s registration Act, West Bengal, was run illegally in Odisha. The accused had never sought permission or written documents from the officials of West Bengal to operate in state.

The charge sheet filed was only a preliminary one to meet the statutory requirement of filing the chargesheet within 120 days and a supplementary charge sheet could follow, said sources in the CBI.

“Investigation is still open. CBI has slapped charges under sections 120 (B), 420, 409, 468, 471 of IPC and 3,4 and 6 of Prize Chits and Money Circulation Schemes (Banning) Act, 1978 against Zodiac Foundation and the accused in the charge sheet,” CBI sources added.

Dandapani’s bail, which was to be heard today, has been deferred by the court.