ED freezes assets of scam-hit finance firm

KOCHI: The Enforcement Directorate (ED) has frozen the assets of the owners of scam-hit Popular Finance, headquartered in Konni, Pathanamthita. Kochi Enforcement Directorate office has writen to Registrars and banks in this regard.

According to reports, the accused will be re-arrested by ED on Monday ater their police custody ends.

The accused had tried to transfer their assets abroad earlier. All assets of Popular Finance across the country will be frozen.

The police have so far arrested five persons, including Popular Finance managing director Roy Daniel, his wife Prabha Thomas, who is also the managing partner, their daughters Rinu Mariam Thomas, Riba Thomas and Riya Ann Thomas in the case.

Riya, Riba and Rinu are lodged in Atakkulangara jail. They will be interrogated by ED officers at the prison and will be arrested on Monday.

Meanwhile police have prepared a new First Information Report (FIR) based on provisions under the Banning of Unregulated Deposit Schemes (BUDS) Rules enacted by the central government.

With BUDS being charged on the accused, both the owners as well as the managers of Popular Finance who accepted the deposits will have to face trial. This move is to pre-empt the accused from securing bail.

The police had earlier invoked the state’s deposits protection law, which did not have sufficient provisions to prevent the granting of bail to the accused. With the filing of the new FIR, the company would be considered to have accepted deposits and when the losses are repaid, the depositors will be given first preference.

Only later would government taxes and bank debts be setled. Exemplary punishment could be given to the accused if the government sets up a special court in consultation with the Chief Justice and transfers all cases related to the scam to this court, according to legal experts.

Popular Finance had a deposit base of Rs2, 000 crore from about 270-odd branches.

It was found that the accused had assets worth Rs125 crore. The accused owns properties in 21 locations across the country.