Cheques bounce as thousands duped by unregulated timeshare scheme demand payback
From a farmer in Belgaum investing Rs 500 a month to the wealthy with crores lured by a foreign holiday, investors and agents, duped by the very deals they once sold, queue up outside the Citrus Checks Inn and the Royal Twinkle Star Club Private Ltd's (RTSCPL) offices in Wadala every day. A total of 2.28 lakh investors are owed Rs 786cr by RTSCPL, according to the capital markets regulator, Securities and Exchange Board of India (SEBI).
Following complaints that began to trickle in in September 2012, SEBI accused RTSCPL of running an illegal Collective Investment Scheme (CIS) under the garb of a 'Comfort Holiday Plan'. It ordered them to pay back investors within three months in August 2015. The queues began a few months ago, when cheques issued as compliance began to bounce.
RTSCPL's troubles began in 2012, when SEBI began to receive complaints from investors, though it had been operational since June 2008, offering equated holiday plans with "guaranteed returns of 1.5 times in 4 years, 1.7 times the investment in 5 years, double in 6.5 years and 3 times in 9 years," according to the SEBI submission. While director Omprakash Basantlal Goenka, 69, who ran the scheme along with promoters Prakash Ganpat Utekar, Venkatraman Natarajan, and Narayan Shivram Kotnis, claimed to dna that they were merely seeking to compete with other timeshare holiday plans existing in the market by differentiating themselves with returns, SEBI dubbed it "tantamount to illegal fund mobilisation".
To make matters worse, it is alleged that after last year's SEBI order, RTSCPL continued its operations in the name of Citrus Checks Inn, a subsidiary of the Mirah Group of Companies, set up by the same directors.
As anxious investors run pillar to post, Goenka, who shows up to address the angry crowd every day, vows to return every penny. The Supreme Court upheld a tribunal order against Sebi's order in February this year, allowing RTSCPL two years to make repayments. The Apex Court's order on the legality of Citrus Checks Inn is awaited later this month.
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