Kerala police have arrested the owner of the Kerala based Non Banking Financial Company against which over 200 cases have been filed by depositors as well as investors alleging a fraud of around Rs 2000 crore.
Police have issued a lookout notice against the board members, including managing partner Daniel Roy of ‘Popular Finance‘ and police have arrested them.
Konni police told PTI that “the phones of Daniel Roy and his wife Prabha, who is also a partner in the firm, are switched off. We have received over 200 complaints against the firm.”
Popular Finance, headquartered in Pathanamthitta district, has been engaged in the business of gold loans since 1965 and has 284 branches spread across five states mainly in South India.
The police stated on Saturday that “their daughters and senior executives of the firm, Rinu Maria Thomas and Riya Anna Thomas, were detained at New Delhi airport on Friday, trying to leave the country in the face of complaints from aggrieved depositors.”
The matter came to light after all the branches of the finance company were reportedly shut following uproar by customers who sought to withdraw their deposits from the company which has allegedly gone into losses.
Pathanamthitta SP Simon said, “Our preliminary assumption is that the firm’s deposit collection would go up to Rs 2,000 crore. We are getting complaints from across states, where it (Popular Finance) has branches. As per complaints already under the police process, Rs 300 crore is at stake.”
He also said that “We don’t think (people’s) deposits are safe with the firm. We realized that a chunk of deposits has been shifted overseas. A probe is on.”
According to police, the company owes around Rs 2,000 crore to at least 1,500 depositors.
Cases have been registered under various provisions of the Indian Penal Code (IPC) including Section 406 (punishment for criminal breach of trust) and 420 (cheating).
Meanwhile, many depositors and investors today staged a sit-in in front of various offices of the firm seeking to withdraw their deposits.