Search the Internet          Tips  Sites: Finance, Investment

RBI informs police about unincorporated bodies seeking funds

The Reserve Bank of India has sought the help of the police to crack down on unincorporated bodies seeking deposits from the public through newspaper advertisements.

A number of companies, which were not registered with the Registrar of Companies, had been inviting deposits from the public with an assurance of guaranteed returns, RBI sources said.

Unregistered bodies were not allowed to invite deposits and the process was "absolutely illegal", the sources said and RBI has drawn up a list of such companies in Calcutta.

The central office of RBI in Bombay had been already informed, sources said, and the apex bank would shortly come out with a series of advertisements to make the public aware about the risks involved in parking funds with such companies.

RBI had also informed the state government about the matter.

The police, in a written communication, however, informed RBI that they could take action only when there was a concrete evidence of cheating, otherwise, they would not be able to take any preventive action.

RBI sources said that the Calcutta Stock Exchange had been also intimated about the issue. The CSE authorities, however, stated that since bodies were not members of the bourse, no action could be taken against them.

RBI is making all efforts to stop this menace. Recently, the apex bank had informed the stock market regulator, Securities & Exchange Board of India, they said.

Tell us what you think of this report