Govt inspecting 87 chit-funds, MLM companies

The Ministry of Corporate Affairs (MCA) has asked Registrar of Companies (RoC) and its Regional Directors to check the accounts of chit fund companies and certain Multi-Level Marketing (MLM) firms. So far, 87 companies have come under the scanner for alleged irregularities related to the chit fund schemes and money circulation schemes in chit fund companies & MLM firms respectively.

According to the Ministry of corporate affairs, these directions have been issued on the basis of complaints received from investors. Serious Fraud Investigation Office (SFIO) has been recommended setting up a central regulatory agency for the implementation of the prize chit fund and money circulation scheme act, 1978.

On the basis of reports received from the Registrar of companies, the government can order investigations into the affairs of the company.