Indian lawmaker arrested in financial scam

AP News
Posted: Nov 21, 2014 7:44 AM

NEW DELHI (AP) — An opposition national lawmaker was arrested Friday on suspicion of stealing funds from a multibillion-dollar Ponzi scheme that collapsed in eastern India, an official said.

The scam left hundreds of thousands of investors virtually penniless.

Srinjoy Bose was arrested on charges of criminal conspiracy, stealing funds and deriving undue financial benefits, said Kanchan Prasad, a spokeswoman for the Central Bureau of Investigation, India's federal investigating agency.

Bose belongs to the All India Trinamool Congress, the governing party in West Bengal state but an opposition party at the federal level.

The scheme was run by the Saradha Group, a state-based consortium of private companies running collective investment plans. It reportedly collected around 300 billion rupees ($4 billion) from over 1.7 million depositors before it collapsed in April 2013.

Corruption is endemic in India. In September, powerful southern Indian politician Jayaram Jayalalitha was convicted of corruption and sentenced to four years in prison. She was accused of amassing 660 million rupees ($11 million) at a time when she was receiving a token 1 rupee as her monthly salary. She appealed the verdict and is free on bail.