Subhiksha founder R Subramanian's journey: From IIT-IIM to 20 years in prison
Subramanian has confessed to defaulting on over ₹137 crores to depositors of all schemes. He has not voluntarily deposited any money in the past ten years to repay any of his 587 investors
A special court in Chennai has sentenced R Subramanian, the founder of the retail chain Subhiksha, to 20 years in prison for duping hundreds of investors of their hard-earned money.
The court convicted Subramanian and his associates under the Tamil Nadu Protection of Interests of Depositors (in Financial Establishments) Act.
Subramanian completed engineering and MBA from prestigious institutes such as IIT Madras and IIM, Ahmedabad. He was in fact a gold medallist from IIT Madras. In 1991, he founded a financial services company called Viswapriya India Ltd., his first entrepreneurial venture. In 1997, he established another company Subhiksha, a retail chain of about 1,600 stores that sold groceries, fruits, vegetables, medicines, and mobile phones, and employed thousands of people at its peak.
Hundreds of investors deposited money in Viswapriya’s attractive schemes that offered high interest rates. When their deposits matured, the company managed to convince them to reinvest the amount in new schemes that promised enticing short-term returns. When it was time for Viswapriya to return the deposits to the investors, the company defaulted, leaving the depositors high and dry.
Subramanian has confessed to defaulting on over ₹137 crores to depositors of all schemes. Moreover, he has not voluntarily deposited any money in the past ten years to repay any of the 587 investors. These investors are still waiting for their compensation.
The court has levied a fine of ₹8.92 crore on Subramanian and ₹191.98 crore on the convicted entities. From this, ₹180 crore is intended to compensate the depositors who were duped, after the authorities verify their documentation.