Govt inaction on Ponzi companies: PIL

The state government on Wednesday sought time to file objections to a PIL that accuses it of inaction over the “frauds” committed by 11 investment companies.

The petition, filed by two individuals names Imran Pasha and Nazia Banu, stated that these companies had collected more than Rs 3,000 crore from the public by luring them with investment schemes. These companies signed investor agreements with the public by promising handsome monthly returns (interest and profit), they added.

The petitioners contended that the companies were operating in violation of the statutory regulations and that the state government failed to act against them. Investors who lost money filed FIRs but police have not taken any action because the people running the companies are “influential” and enjoy political patronage, according to the petitioners.

The petitioners further stated that representations made to government officials and the state police chief about the FIRs have "fallen on deaf ears". Claiming that the companies were cheating people, the petitioners urged the court to order an investigation into their businesses.

The court issued notices to the government and the companies. The next hearing will be after 10 days.