Kolkata:
The Saradha Group was an Indian conglomerate that operated across West Bengal, Assam, and Odisha, offering investment schemes and network marketing opportunities. The company primarily targeted lower-income individuals, promising lucrative returns on their investments.

Reasons for Ban

1. Collective Investment Scheme:
Investigations revealed that the Saradha Group was operating an unauthorized collective investment scheme (CIS). The firm collected funds from the public, promising exceptionally high returns, which eventually led to massive financial losses for investors.

2. Unregistered Schemes:
The company’s multi-level marketing (MLM) activities were not registered with the Securities and Exchange Board of India (SEBI), raising serious concerns about the legality of its operations. SEBI later declared these schemes illegal, leading to a widespread crackdown.

What Happened Next

• On April 14, 2013, an FIR was lodged against Sudipto Sen (Saradha Group Chairman) and Kunal Ghosh, resulting in the arrest of several key individuals linked to the firm.

• By April 2014, approximately 385 FIRs had been registered against the group, and the Special Investigation Team (SIT) had filed 288 charge sheets in connection with the case.

The Saradha scam, often described as one of the biggest financial frauds in eastern India, exposed severe gaps in financial regulation and investor protection, affecting lakhs of small investors across multiple states.