A Serious Fraud Investigation Office (SFIO) probe into the Saradha scam and chit fund operations of 62 other entities has found serious financial mismanagement and siphoning off of funds by their promoters, who took advantage of regulatory gaps.
The financial fraud investigative agency is also trying to get details stored by these entities on computer servers located abroad, the Corporate Affairs Ministry said on Monday, while releasing excerpts of the interim report on SFIO probe.
While the final report would be submitted by SFIO by December, the interim report has said useful information has been collected from the servers of the companies housed in India by using forensic technology. "However, enforcement agencies are making all efforts to access information stored in servers located outside India," it said.
"There has been proliferation of innovative financial products in the market due to technological advancement and extensive use of the internet to market such products to investors," the report said. It also pointed out there has been evidence of financial mismanagement, diversion and siphoning off of funds by the promoters.
Due to non-cooperation by the promoters of one of the group companies, SFIO had to resort to search and seizure operations, after obtaining appropriate court orders, it added.
SFIO, which comes under the Ministry of Corporate Affairs, was asked to conduct investigations against 63 'Chit Fund' companies operating in the eastern states and belonging to five business groups including Saradha.
The financial fraud investigative agency is also trying to get details stored by these entities on computer servers located abroad, the Corporate Affairs Ministry said on Monday, while releasing excerpts of the interim report on SFIO probe.
While the final report would be submitted by SFIO by December, the interim report has said useful information has been collected from the servers of the companies housed in India by using forensic technology. "However, enforcement agencies are making all efforts to access information stored in servers located outside India," it said.
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The promoters of these companies had tried to take advantage of multiple legislations with overlapping jurisdictions, it added.
"There has been proliferation of innovative financial products in the market due to technological advancement and extensive use of the internet to market such products to investors," the report said. It also pointed out there has been evidence of financial mismanagement, diversion and siphoning off of funds by the promoters.
Due to non-cooperation by the promoters of one of the group companies, SFIO had to resort to search and seizure operations, after obtaining appropriate court orders, it added.
SFIO, which comes under the Ministry of Corporate Affairs, was asked to conduct investigations against 63 'Chit Fund' companies operating in the eastern states and belonging to five business groups including Saradha.