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8 Scams That Shocked The Nation


Investors have lost big in many financial scams and have failed to receive their hard-earned money back evern after several years of investigation and trials. This post is about some of the biggest financial frauds/scams in India over the last few years. 

1) Harshad Mehta scam

Estimated Size: Rs 4,000 crore
Central figure: Harshad Mehta
Discovered: In 1992
Modus Operandi: Used money from banks to make personal gains via investment in shares 

2) CRB Scam 

Estimated Size: Rs 1,200 crore
Central Figure: CR Bhansali
Discovered: 1996
Modus Operandi: Raised public money through FDs, MFs and debentures via nonexistent firms and invested them in stocks for personal gains

3) Ketan Parekh Scam

Estimated Size: Rs 800 crore
Central Figure: Ketan Parekh
Discovered: 2001
Modus Operandi: Parekh was involved in circular trading and stock manipulation through 1999-2001 in a host of companies. Like his mentor Harshad Mehta, Parekh too borrowed from banks like Global Trust Bank and Madhavpura Mercantile Co-operative bank, and manipulated a host of stocks popularly known as K-10 stocks. 

4) Satyam Scam

Estimated Size: Rs 14,162 crore
Central Figure: Ramalinga Raju
Discovered: 2009
Modus Operandi: An accounting scandal where Ramalinga Raju confessed to having cooked up the accounts of Satyam Computers and inflated its bank balances. He has, along with his family members, also been accused of laundering money through a mesh of hundreds of companies. 

5) Sahara Housing Bonds

Estimated Size: Rs 24,029 crore
Central Figure: Subrata Roy
Discovered: 2010
Modus Operandi: Bonds issued to 29.6 million investors without following Sebi regulations and investor protection measures mentioned therein

6) Speak Asia

Estimated Size: Rs 2,200 crore
Central Figure: Ram Sumiran Pal
Discovered: 2012
Modus Operandi: An online business survey firm that collected thousands of crores of rupees from over 24 lakh investors, asking them to fill surveys and guaranteeing to quadruple their income in one year, Speak Asia was accused of running a Ponzi scheme. A criminal case was registered against the firm in 2011, some accounts frozen and its business shutdown. 

7) Saradha Scam

Estimated Size: Rs 10,000 crore
Central Figure: Sudipta Sen
Discovered: 2013
Modus Operandi: One of the biggest Ponzi schemes in West Bengal that enjoyed political patronage and lured millions of investors to deposit money with the promise of abnormally high returns including fancy holidays etc. The chit fund eventually collapsed leading to defaults after a crackdown by SEBI and the Reserve Bank of India. The default, apart from leaving small depositors high and dry, also led to 10 media outlets owned by Saradha being forced to wind up, leaving 1000 journalists jobless. 

8) NSEL Scam

Estimated Size: Rs 5,600 crore
Central Figure: Jignesh Shah
Discovered: 2013
Modus Operandi: Investors were wooed by offering fixed returns on paired contracts with agri and industrial commodities as underlying. the stocks were missing and money was allegedly siphoned by so-called borrowers

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  1. Among them I believe Harshad Mehta scam is the most popular.