The unauthorised money-collection schemes are widely known as chit funds in West Bengal and other Eastern and Northeastern states, although their operators are not registered as chit fund companies in most cases.
In many such cases, regulators and government agencies such as Sebi and the Serious Fraud Investigation Office have found that these were Ponzi schemes, where new investors were given returns from funds of earlier investors.
In the latest case, Sebi has initiated the process for sale of assets of Tower Infotech Ltd, according to an order from the Calcutta High Court, under which an e-auction would be conducted for sale of land and buildings of the company.
The bids have been invited by Sebi till October 27. The auction would take place on October 30, the regulator said, in its tender notice.
The high court has directed Sebi to sell certain assets of Tower Infotech and distribute the proceeds among duped depositors and debenture holders. This is probably the first instance of Sebi conducting an e-auction to liquidate assets of a deposit-mobilising company for refund to the investors.
In some other cases, Sebi has already ordered sale of shares held by certain companies that have found to be in default of payments as directed by the regulator.
Through enhanced powers, Sebi has been allowed to attach and liquidate the assets of defaulter entities, including in cases of illicit money schemes. Sebi has also been given power to act against companies running illicit money-pooling schemes involving Rs 100 crore or more.
The four properties of Tower Infotech being sold have total reserve price of over Rs 17 crore.
As per Sebi’s tender notice, bids have been invited along with a payment for an amount equivalent to 10 per cent of the reserve price as Earnest Money in connection with the sale of the listed assets or properties of Tower Infotech.
The properties listed for sale through the auction include a land parcel with a four-storey building in Kolkata with a reserve price of Rs 6.36 crore and another land with a three-storey lodge building and marriage hall (among others) in Medinipur with a reserve price of about Rs 2.94 crore.
Two other properties include land plots with a three- storey hospital building; and an office building (reserve price of Rs 2.32 crore) in South Parganas and land with a two-storey auditorium hall, a single-storey restaurant building, a single-storey office building and a pump room (reserve price of Rs 5.56 crore).