Date:26/04/2007 URL: http://www.thehindu.com/2007/04/26/stories/2007042618790500.htm

Karnataka - Bangalore

Two arrested following complaint from chit fund scheme investor

Staff Reporter

Many throng police station seeking help in getting back money

BANGALORE: Several people who said they have lost around Rs. 50 lakh in a chitfund scheme thronged the Byappanahalli police station on Wednesday and urged the police to help them in getting back their money.

On a complaint by one of the investors, Shankar, the Byappanahalli police arrested a woman and her son-in-law who were running the scheme.

On learning that the police had arrested Mallika Devi (60) and her son-in-law Lingaraju (35), the investors gathered at the police station and asked the police to ensure that the two returned their money.

Chit fund business

According to the police, Mallika Devi's family has been running the chit fund business from their house in New Byappanahalli for nearly three decades.

Since the last two years she had not repaid the money to some of the investors.

Mallika Devi, Lingaraju and their business associate Kantharaj remained untraced for the past 15 days and this had created panic among the investors who approached the police.

Search on

The police, who arrested the two accused from Bidadi, are on the lookout for Kantharaj and two others who were also connected with the business.

The police said Mallika Devi blamed the crisis on 150 members failing to return the money they had borrowed, which, in turn, put her in a spot when it came to repaying money to other investors.

The police told The Hindu that they were yet to ascertain the claims made by the investors, mostly from the lower middle class families in New Byappanahalli.