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July 3, 2001
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Money > Business Headlines > Report July 3, 2001 |
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RBI warns investors of investing in shady schemesDebjoy Sengupta The Reserve Bank of India has cautioned the general public against unauthorised acceptance of deposits by individuals, firms or an unincorporated association of individuals, and trusts. The RBI notification is perceived as being in response, though a very late one, to the activities of small firms in the city which are inviting deposits from the public in tranches of Rs 25,000, promising interest of Rs 2,500 per month and return of principal in six months. The apex bank has clarified that unincorporated bodies should not accept any deposit from general public. These firms are also not allowed to receive deposit under any scheme or arrangement or in any other manner, or lending in any manner. RBI has also advised unincorporated bodies to repay the deposits accepted by them and refrain from accepting deposit from the public so as to comply with laws. Further, the bank has also cautioned the public that if they deposit money with such unincorporated bodies, they do so at their own risks. In a parallel development, Citi Securities, one of the firms promising Rs 2,500 per month against one time payment of Rs 25,000, issued a advertisement asking investors not to pay heed to rumours in the market against the company. The advertisement said necessary legal action may be initiated to safeguard itself. In the recent weeks a number of such firms have mushroomed in the city. They advertise in leading vernacular dailies, inviting deposits and information on franchisees spread all over the city. Indian Securities and Sai Securities are two other such companies making similar claims. Sai Securities advertises that it issues bank guarantee against deposits. Depositors are told that their deposit is being used to generate foolproof returns in the stock market. However, no listed broker is connected to such firms. In fact, brokers in the city point out that a payment of Rs 2,500 against deposit of Rs 25,000 amounts to a 120 per cent return on annualised basis. With the stock market down in the dumps, such returns are not possible. Powered by YOU MAY ALSO WANT TO READ:
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