InvestorQ : What is the case with Popular Finance of Kerala, that has been caught in a fraud?
Aditi Sharma made post

What is the case with Popular Finance of Kerala, that has been caught in a fraud?

Answer
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Mahima Roy answered.
3 weeks ago


Kerala police announced that had recently arrested the owners of Popular Finance, a Kerala-based finance which has allegedly been facing fraud allegations to the tune of Rs.2000 crore. The policy had been on the lookout for the board members including the managing partner.

Now, police has confirmed that they had arrested the MD, Thomas Daniel, and his wife Prabha. The investigation will be headed by the Deputy Superintendent of Policy, K G Simon, who will probe into the case and look into the extent of the fraud and modus operandi.

The probe team has also sought the assistance of the Interpol pertaining to suspicious transactions related to the promoters with foreign entities. The police also took custody of their 2 daughters from Delhi Airport, when they were trying to escape to Australia.

Interestingly, Popular Finance has been engaged in the business of extending gold loans to customers since 1965 and operates through nearly 284 branches across 5 states. The fraud came to light when customers with gold deposits found the officials absconding.

Popular Finance apparently owes around Rs.2000 crore to at least 1500 depositors. It is interesting as to why the company had to indulge in a fraud when gold prices are moving up. Clearly it appears to be a case of investing in other ventures that went bust.