Never-ending story of white collar crimes

·        Law-enforcing agencies need to be empowered to take criminal cases to logical end

M V Syam Sundar

The other day the High Court at Hyderabad was annoyed at the progress of investigation into the misdeeds of real estate company AgriGold which has collected deposits worth about Rs 7,000 crore from millions of customers throughout several States in the name of real estate and failed to repay the deposits. The High Court had even called for the presence of the AgriGold chairman Avvas Venkata Rama Rao and the Additional Director General of Police Dwaraka Tirumala Rao in the court to explain the delay in repaying the deposits to the customers.

AgriGold is not the first case and it is not going to be the last in cheating the gullible in the name of selling products, services, real estate and what not. It is apt to recall that Subroto Roy, chief of Sahara International, is still behind the bars for not returning the deposits worth about Rs 40,000 crore to the depositors. Surprisingly, the Andhra Pradesh CID police did not take Avvas Venkata Rama Rao even into custody let alone arrest and send him to jail for reasons better known to them.

The then superintendent of police of West Godavari district, Dr Kolli Raghuram Reddy, filed a criminal case against AgriGold on the charges of illegally collecting deposits against rules of the RBI. The then Nellore SP Senthil Kumar had also filed criminal case against it. However, at the time the West Godavari police are raiding the offices of AgriGold and seizing the records, the mysterious forces acted in lightning speed and transferred the case to the AP CID. The rest is history. It is really mysterious as to who was the ‘real estate political personality’ that acted swiftly to transfer both the SPs. The case would have gone into the cold storage forever but for the proactive judiciary that has taken the case into its hands.

In spite of the criminal cases filed against AgriGold, the company is doing its business without any hindrance. Several of its agents and the customers who were in deep despair had even committed suicide. Still there is no serious action against the company but for the occasional statements by the politicians that justice would be done to the depositors.

Before AgriGold, there was Golden Forest Ltd which collected Rs 2000 crore in 1990s and disappeared without a trace after criminal cases were filed. Noticeably that AgriGold chief Rama Rao worked for Golden Forest before he started his own venture.

Pearl Agro, popularly known as PACL, also collected deposits worth Rs 40,000 crore from public. Till the judiciary took initiative, there was no police action despite the plethora of complaints against it. Till to date, the company did not return deposits though the SEBI ordered their refund.

A number of companies have cheated and have been cheating the gullible and decamped with thousands of crores of rupees. For instance, Speakasia, the Singapore-based online service company duped people for Rs 3,000 crore. The Andhra Pradesh CID busted the case following a complaint lodged by an NGO, Corporate Frauds Watch. However, the money could not be traced by them. It is the Delhi police who pursued the case and tracked the criminals who finally returned with the booty and started real estate business at Darjeeling.

A number of companies like NMart, Gemini Techno, V-Can Network shut shop long back and nothing is heard about the criminal cases filed against them. Not surprisingly, some of these companies started legitimate businesses with the ill-gotten money hoodwinking the law-enforcing agencies.

Apart from these, there are a number of direct selling companies which are still cheating people and amassing enormous wealth. Amway India, Herbalife, Tupperware, Forever Living Products and other members of Indian Direct Selling Association (IDSA) have blatantly been demanding legislations in their favour to continue their fraudulent business activities. It is apt to recall here that Andhra Pradesh High Court in its judgement in 2006 categorically stated that the business model of Amway is illegal. However, the adamant company still pleads for a separate legislation in support of its illegal business model.

The former head of Amway India and four others did not turn up the other at the criminal court. The magistrate was serious and ordered all the accused to be present in the court by next hearing. This is the scant respect these people have for our judicial system. It is apt to mention here that the Enforcement Directorate has served notice to Amway India for illegally siphoning out Rs 2,000 crore from the country to the USA. However, nothing is heard about it later.

It is high time the law-enforcing agencies were empowered to pursue the criminal cases without political interference and the ill-gotten wealth should be confiscated.