Paazee scam: TN court sentences 2 to 27 years in jail, slaps ₹171 cr fine

The court also admonished the CBI for not examining all the 58,571 investors who were duped of their money by the company, while ordering that all of them be given back the principal amount along with the interest

Air India, Ratnakar Dwivedi, smoking on flight, refuses bail
Representative photo: iStock

After 11 years, a special court for Tamil Nadu Protection of Interests of Depositors (TNPID) Act cases in Coimbatore district sentenced two directors of private firm, Paazee Forex Trading India Private Limited, to 27 years of rigorous imprisonment while imposing a fine of ₹171. 74 crore on them.

Special court Judge AS Ravi lashed out at the Central Bureau of Investigation (CBI) for not examining all the depositors who were cheated by the firm. The court also ordered the agency to examine the remaining and file a fresh FIR if needed.

The judge pronounced that all the depositors apart from those mentioned in the final charge-sheet were also eligible to get their principal amount along with the interest. In the order, the judge has said that the depositors could approach the concerned authorities or the District Revenue Officer to get their money back or can approach the CBI to file a complaint for criminal liability.

The case dates back to 2011, when the CBI registered a case on June 15, 2011 based on the Madras High Court’s direction. According to the CBI, Pazee Marketing Co, based in Tiruppur district was run by K Mohanraj and his wife Kamalavalli. The firm floated various schemes between July 2008 and September 2009 with the promise of high returns along with interests and as per the CBI embezzled money to the tune of ₹930.79 crore from about 58,571 investors.

According to the police, the private firm has collected money from about 58,571 investors between 2008 and 2009. However, the CBI, in its final charge sheet, had examined only 1,402 people and recorded their statement.

Though the CBI mentioned that ₹930.79 crore was collected from about 58,571 investors, it only recorded the statements of the 1,402 people who had invested a total of ₹870.10 crore.

The judge after pronouncing the sentence for Mohanraj and Kamalavalli, directed the District Revenue Officer to distribute the fine amount to all the depositors including the 1,402 individuals mentioned in the CBI’s final report.

A Revenue official in Coimbatore said that they would call people to come and submit the proof of depositing money in those private firms once they get the court’s order copy.

“We would collect the applications and would process them proportionately. Once the verification process gets over and the appeal time for the convicts gets over, we would give the money to the depositors as per the norms,” the official said.

The official also said that this was the first time the court has asked an agency to find out the left out people.

“We used to get the fine amount and as per the judgement, it would be given to the victims of the crime. Even in the financial fraud cases, this was the case. But, this case seems to be first of its kind, since we have to collect and verify the details of the depositors. And, in this process, CBI is also involved,” the official said.