Kolkata on radar of ED; conducts raid in five locations in connection to Rose Valley Scam

Kolkata, November 21: With the controversial Saradha scam coming into limelight, the Enforcement Directorate, in a latest, held raids across four locations in Kolkata in connection with the Rose Valley chit fund scam. The crackdown intensified as ED raids two locations in the New Town area in eastern fringes of Kolkata, one in Dunlop which falls in the municipality of North 24 Parganas district and others near the southern fringes of the city.

The searches were held on the basis of certain revelations made by Rose Valley Group chairman Gautam Kundu who was arrested in 2015 and is currently in jail. Multiple chargesheets were filed in Kolkata and Bhubaneswar courts in this regard. To gather more evidence in the money laundering case, various teams of ED officials searched the premises of Gautam Kundu’s wife Shubhra Kundi, besides the house of one former staff of Rose Valley and, his relatives.

The Rose Valley firm had reportedly floated 27 companies to allegedly run the chit fund operations. The ED has alleged that the scheme floated by the group promised investors in various states inflated returns. According to the ED estimates, the Rose Valley scam is at least five times the Saradha ponzi scam. The group allegedly floated 27 companies to run various schemes. It allegedly collected Rs.17,520 crore from depositors in West Bengal, Assam and Bihar.

The ED has been interrogating various bigwigs connected to the Rose Valley scam. Prior to this, Chief of Shree Venkatesh Films and Mamata Banerjee’s close aide, Srikant Mohta had been arrested in January 2019 by the CBI in connection with the Rose Valley scam. The Bengali film producer and distributor was then interrogated by the CBI at his offices. He was served a notice by the agency regarding “acceptance of money from Rose Valley”.

The Rose Valley financial scandal is a major financial scam caused by the collapse of a Ponzi scheme run by Rose Valley Group. It is in the limelight because of political connections found in the scam. It hit the states of West Bengal, Assam, and Bihar in 2013. The scam is calculated to be even bigger than the Saradha Chit Fund scam and as per ED. Around Rs.17,520 crore was reportedly raised from around1 lakh investors in the name of the "Holiday Membership Scheme."

The Rose Valley group had allegedly floated a total of 27 companies for running the chit fund operations of which only 12 were active. Gautam Kundu, the Chairman and Managing Director of the company, has had properties worth Rs 293 crores attached by the ED in connection with the scam. It is alleged that the company had made "cross investments" in various other floating companies to reduce its liabilities towards investors.