Investigation revealed that schemes floated by Bhubaneswar-based Ashore Group of Companies were nothing, but a fraudulent pyramid style money circulation chain, which required endless streams of recruits to succeed. It involved an internal re-distribution of wealth from new to old entrants and no substantial trading took place as claimed by the company.
It is now under the scanner of the State Crime Branch (CB). The CB has arrested four senior executives, including Managing Director Viresh Kumar Choudhury and CEO-cum-Director Deepak Kumar Pothal while efforts are on to nab other office-bearers of the company.
During investigation, the CB stumbled upon some astonishing facts. Ashore Group consists of five companies - Ashore Infrastructure, Ashore Life Assets and Securities, Ashore Media and Television, Ashore Pharmaceuticals and Ashore Commercial.
“The company agents had been luring depositors through websites, leaflets and motivating them to deposit money with a promise to double it within a short time,” an investigating official said. The company was issuing redeemable preference shares of Rs 10 per share. A person buying 1,000 shares was promised ` 20,000 in 42 months at an interest rate that is twice that of the scheduled bank rate.
“The Ashore Infrastructure Ltd had collected huge amounts from the unsuspecting depositors towards the purchase of land. It is found that the company was showing the plots taken either on lease or on agreement to the depositors as its own properties,” said the official.
It was paying commission up to 15 per cent to its agents collecting deposits and making payments to the old depositors from the money collected from the new depositors. “The company has no profitable business activities through which it can provide the depositors double the bank interest rate. It was cheating people through various fraudulent means. It was neither listed with RBI as a non banking financial company nor any stock
exchange,” the CB official added.
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