In West Bengal,  Saradha was a chit fund that operated across eastern India with a concentration. Depositors could invest as little as Rs 100 with the promise of disproportionately high returns of up to 50 per cent per year. The scale of the scam was much larger in Orissa. As many as 163 chit fund firms collected around Rs 4,600 crore by deceiving the people in Orissa, whereas the chit fund scam in West Bengal is estimated at Rs 2,460 crore. At least 10 lakh families, mostly belonging to the low-income group, have been affected by the scam in Orissa.

However, The scam was termed as a classic ponzi scheme where the pay-outs for old investors were generated by investments from new ones. Since no assets were created, the scheme collapsed when, inevitably, new investors dried up. In 2013, market regulator Securities and Exchange Board of India ordered Saradha to stop its operations.

Earlier, a Trinamool MP headed the fund’s media division and the chief minister herself inaugurated two Saradha offices. This helped the scheme become popular among the consumers. 

Rose Valley 

Rose Valley scheme followed the same model: a Ponzi scheme that benefited by being seen as linked to powerful people. Rose Valley financed Bengali films and even sponsored the Kolkata Knight Riders Indian Premier League cricket team before going belly up in 2015.

Then the top court had ordered a CBI inquiry into the multi-crore Saradha scam and similar cases in the state. It had also asked the CBI to investigate chit fund-related scam cases in Orissa and other states, including Tripura and Assam.

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