ED arrests 2 directors of WB firm that duped investors through ponzi scheme

The Enforcement Directorate (ED) on Saturday said it has arrested two directors of a West Bengal-based company that allegedly ran a ponzi scheme and diverted Rs 1,786 crore worth of public funds.

Prabir Kumar Chanda and Pranab Kumar Das, directors of MPS Greenery Developers Limited, were arrested on August 24 and a special Prevention of Money Laundering Act (PMLA) court in Kolkata sent them to ED custody till September 1, the central agency said in a statement.

MPS Greenery Developers Limited raised funds of about Rs 2,682 crore during 1999-2000 to 2013-2014 from investors through various "fraudulent" income schemes, by issuing agro, orchard and teak bonds in violation of norms of banking regulator RBI and markets regular SEBI, it alleged.

The company was controlled and managed by its CMD Pramatha Nath Manna, the two arrested directors and other associates.

The ED alleged that the accused "diverted" public funds of Rs 1,786 crore to subsidiary and associate companies of MPS Greenery Developers Limited and associated firms.

"The funds were ultimately withdrawn as cash, diverted to third party entities and properties were acquired in the name of directors and their family members," it claimed.