Four office-bearers of a private credit cooperative society were arrested today on the charge of cheating depositors by not returning their accrued capital after maturity, police said.
"Care Mutually Aided Society Ltd had allegedly collected Rs 8 crore from four hundred members enrolled, and has failed to return the interest and principal amount after maturity of their deposits," said DCP (Law and Order) M. Srinivas.
He said that prima facie the Society management had violated the Cooperative Society by-laws in cheating members of public.
"The directors of the Society fraudulently got crores of rupees released as loans without any collateral," he said.
"In 2007, the then president of Society, C.V.Subba Rao colluded and conspired with other directors of Boar and sanctioned a loan of Rs 1.5 crore to one of the directors P.V.Nagamalleswar Rao without any surety or mortgage," the DCP said.
Rao, however, failed to repay the amount as he invested the same in a real estate firm.
"The former and current Boards of directors used the Society for their own benefit," the police officer said.
The accused are identified as director P.V.Nagamalleswara Rao, Chandrakanth, an accountant-cum-cashier, R.Satish and Jr.Assistant Ch.R.V.SS Prasad.
Police said the search was on to trace ex-president Ch.V.S. Subba Rao, Vice-president P.Ram Mohan Rao, current president M.N.N. Reddy and directors A.H.M.Das, B. Sriramulu, P. Mallikarjuna Rao, G.Subbaranagayya, Ch. Raju, A. Satish and Ch.Prakash.
