April 19, 2013

Chit-fund ties may cost Trinamool Congress dear


By Saugata Roy, TNN | Apr 19, 2013, 01.12 AM IST


KOLKATA: The honeymoon is over. Trinamool Congress is bracing for a bruising payback for its bonhomie with chit-fund companies.

With thousands of small investors - especially in semi-urban and rural areas - heading for doom, the Mamata Banerjee  government faces perhaps its gravest crisis ever.

For seven years, chit fund companies thrived in Bengal, mopping up thousands of crores as short-term deposits from people expecting unbelievable returns.

The bubble is about to burst bringing back memories of the Sanchayita chit fund crisis of 1980 in which about a lakh depositors lost Rs 120 crore.

The tell-tale signs are similar. About 1,200 employees of the Saradha Group media outfits - Bengal Post, Sakalbela, Azad Hind, Tara News, Tara Muzik and Tara Bangla - are out of job. And chit fund agents, on the run from angry depositors, are mobbing senior Trinamool leaders to bail them out.

The journey that began in 2011 with Saradha Group sponsoring dozens of motorcycles and ambulances that chief minister Mamata Banerjee flagged off in Jangalmahal has come a full circle.

Journalists rendered jobless by the closure of Saradha media businesses have appealed to the government for help. "In the last three years, we got the Form 16 only once. Our salaries are pending for over three months," a former Bengal Post employee said.

Saradha Group agents also knocked the doors of Trinamool leaders - Mukul Roy and Partha Chatterjee - complaining that they had to flee home because the company couldn't repay depositors.

Sensing the public mood, industries minister Partha Chatterjee said on Thursday: "Chit fund managers are safe as long as they protect the interests of the agents and the depositors." Chatterjee asked the journalists to give their problems in writing so that the government can intervene and chief minister said all efforts are on to arrest Saradha CMD Sudipta Sen.

The assurance may be too little, too late for the ruling party that milked these media houses to garner public support. All these channels and newspapers took a pro-Trinamool stand to get government advertisements. The government subscribed many of these pro-poribartan newspapers for state public libraries. Chit fund companies also reciprocated by bailing out ruling party leaders in difficult times. For instance, they helped a senior minister when he ran out of funds to felicitate the Brazilian Masters in an exhibition football match in December 2012.

The meltdown started after Trinamool MP Somen Mitra wrote to the corporate affairs ministry about the mushrooming of chit fund firms that he called "unprincipled companies". "It was the first letter. I wrote to the Sebi chairman later. I do not remember the dates," Mitra told TOI on Thursday. The Centre chose to go slow, possibly out of political considerations because Trinamool was then the biggest ally of the Congress in UPA-II.

Chit fund firms took advantage of this political situation to expand their business. Some diversified into several sectors from real estate to tourism. For instance, Saradha Group added at least 11 verticals, including media retail, realty, construction, exports, cement, hospitality, agro, publication, financial management, travel and education.

The Group got a boost after it inducted Trinamool MP Kunal Ghosh as Group Media CEO. Ghosh has since quit Saradha and left an alarming parting note on the social media: "We are passing through difficult times. Enemies have joined hands. Sometimes I feel they are out to kill me...I will fight to the last. But if something happens to me, I have left behind the names with a person I know". He was unavailable for comment.

A section of the Saradha Group, who felt cheated, pointed fingers at CPM state secretariat member Rabin Deb with whom Sudipta Sen was in touch before making forays in the media.

"Sen had come to us like many others because the Left Front was in power then. I didn't assure him anything. In fact, the media expansion was done much later. I met some of the employees over their grievances. That's all. Ask those who were hand-in-glove with the chit fund owners and are now trying to pass the blame on me," the CPM leader said.


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