Nirmal Bhangoo arrested for Rs 60,000-crore scam

After a baffling silence for almost two years, the Central Bureau of Investigation (CBI) has finally arrested India’s biggest scamster Nirmal Singh Bhangoo and three other top officials in connection with Rs 60,000-crore chit fund scam in which 5.5 crore investors were duped. The development comes after the Supreme Court found that Pearl Agrotech Corporation Limited (PACL) had failed to refund Rs 49,000 crore to investors.

While the probe agency aggressively conducted raids and arrested accused in several other chit fund cases in West Bengal, Pearl Group chairman Bhangoo remained untouched for two years. 

On October 13, 2014, Millennium Post had broken the story on how the CBI had ‘compromised’ India’s biggest Rs 47,000-crore ponzi scam investigation. Curiously, Pearl group chairman Nirmal Singh Bhangoo, against whom the CBI had registered a case on February 19, 2014, for allegedly duping over five crore customers by promising them land and goods, remained a free man all this while.

“Since he is cooperating with us, we have decided not to arrest him,” the CBI spokesperson had then said. However, in all other ponzi scams cases, where the amount is not even 10 per cent of this case, the promoters were arrested by the agency. It is alleged that because of pressure from some influential quarters, Bhangoo could manage to evade arrest for two long years.

In its biggest ever fine, the Securities and Exchange Board of India (Sebi) had on September 23, 2015, imposed a penalty of Rs 7,269.5 crore on PACL Ltd and its four directors for illegal and fraudulent mobilisation of funds, saying the company deserves “maximum penalty” for such large-scale duping of the public. The penalty followed another order by Sebi last year, wherein the PACL was asked to refund Rs 49,100 crore it had collected through illicit schemes over a 15-year period.

In a crackdown on PACL last month, Sebi attached all assets of the company and its nine promoters and directors for their failure to refund more than Rs 60,000 crore due to investors –the biggest illegal mobilisation of funds. According to Sebi, the company had mobilised nearly Rs 47,000 crore public fund, twice the amount the Sahara group is in the dock for. 

But the most significant aspect of this case was that the Pearl Group operated from the heart of Delhi, cocking a snook at the CBI, Finance Ministry and RBI. Pearl Group continued with its operations year after year while enjoying patronage from leaders belonging to Akali Dal, Bharatiya Janata Party (BJP) and Congress.

Finally, on February 19, 2014, the CBI booked Bhangoo, charging him with criminal conspiracy and fraud.  The proceedings were initiated against PACL Ltd and also its promoters and directors – Tarlochan Singh, Sukhdev Singh, Gurmeet Singh, Subrata Bhattacharya, Nirmal Singh Bhangoo, Tiger Joginder, Gurnam Singh, Anand Gurwant Singh and Uppal Devinder Kumar. 

The Sebi case against PACL dates back to 1999, when acting on a complaint, the regulator ordered the company to comply with its CIS regulations.