State fails to act on SEBI order for checking Ponzi schemes

Jharkhand has not yet complied with an order of the Securities and Exchange Board of India (SEBI) which was intended to check Ponzi schemes.

SEBI had asked Jharkhand to form a state-level coordination committee for sharing information among state and central agencies to curb Ponzi schemes.

The board had asked the state to hold periodical meetings of the committee and appoint a state level nodal officer in August and October last year.

This assumes significance as the Supreme Court chief justice P Sadashivam’s bench on Tuesday gave two weeks to all the stakeholders and states to file their reply on a PIL regarding Ponzi scams and firms.

The PIL was filed by Humanity Salt Lake against the Union of India.

The move came after Reserve Bank of India (RBI) sought time till July while SEBI, enforcement directorate (ED) and Serious Fraud Investigation Office (SFIO) expressed their readiness to submit report within a week.

The SC will hear the case on April 30 next.

"A coordination mechanism between the state governments and other central agencies is needed to ensure timely action against unauthorized fund mobilising activities. The union finance ministry has already written to state governments to set up a coordination committee including representatives of SEBI, RBI, ministry of company affairs (MCA) and economic offences wing of the state police. So far only Kerala and Odisha have done so," stated a letter by S Raman, a full-time member of SEBI.

A copy is available with Hindustan Times.

State institutional finance secretary Mridula Sinha has now asked the deputy commissioners (DCs) to prepare a list of non-banking financial companies (NBFCs) and such fund mobilising entities operating without certificate of registration (CoR) from RBI and sought action taken report (ATR).

This apart, additional finance secretary Sunil Kumar Sinha has sought the DCs' views on the formation of the state level coordination committee.

"Entire administration is now engrossed in holding the parliamentary election. The additional deputy collector (ADM, law and order) has, however, forwarded the matter to the SDO and SSP to prepare the list of such companies and a detailed report on action taken so far," a senior official said on the condition of anonymity.

The RBI has so far listed over a dozen such dubious companies operating across the state while at least seven Ponzi companies have been sealed and half a dozen have fled leaving investors in the lurch in and around Jamshedpur during last eight months.

Topping the list is Raj Com in Jadugora against which a PIL is pending in the high court alleging siphoning off Rs 1,500 crore from 8,000 investors and Ramesh Topno who is alleged to have fled with Rs 50 crore.