Prayag chairman Basudeb Bagchi held in Ponzi scheme case
CBI arrests Prayag Group chairman Basudeb Bagchi, says the investigations have revealed that the group had collected Rs2,862 crore in public deposits
Kolkata: The Central Bureau of Investigation (CBI) has brought into its net another suspected Ponzi scheme operator from West Bengal.
Prayag Group chairman Basudeb Bagchi and his son Avik, chief executive officer, were arrested on Wednesday.
The CBI said in a statement that its investigations had revealed that the Prayag Group had collected Rs2,862 crore in public deposits.
In the aftermath of the collapse of the Saradha Group in early 2013, the Prayag Group ran into rough weather, and has since kept a low profile.
However, it came to light at that time that it had through various arms raised at least Rs500 crore in illegitimate public deposits.
Founded by Basudeb Bagchi in 2002, the group had within 10 years of operation spread itself in many ventures. Most notably, it launched a film city in the interiors of West Bengal’s West Midnapore district to be spread over 2,700 acres and built at cost of Rs1,000 crore.
At the time of its launch in April 2012, it was endorsed by actor Shah Rukh Khan, who is also West Bengal’s brand ambassador.
But within a year, it was found that the group had encroached on at least 360 acres of state-owned land.
Still, the state administration took no action against the group until May 2013.
Aside from the film production facility, the group had claimed to have invested in various other businesses such as real estate, cement, food processing, tea cultivation and fisheries.
On Wednesday, the father-son duo who ran the group were summoned to the CBI headquarters in Kolkata, and arrested after several hours of questioning.
The Kolkata police had in May 2013 raided the offices of the Prayag Group, but nothing substantive followed.
The Prayag Group has been on the centre’s radar for at least three years now.
In March 2014, the ministry of corporate affairs had released a list of deposit-taking companies against which it had received complaints.
The list included the Prayag Group and many others such as the Saradha Group and Rose Valley, which, too, are being investigated by the CBI.