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Fraud, greed and gullibility
- Lure of high returns in low-yield times

June 2005: Ratan Dhar signs up with Biniyog and puts in Rs 2.5 lakh, eyeing a monthly return of 12 per cent. The first month's yield of Rs 30,000 prompts him to pool money from family and friends and pump it all into the stock market. By April 2006, his investment swells to Rs 28.25 lakh.

June 2006: The 36-year-old jeweller is running from pillar to post to recover his principal investment from Bhaskar Mukherjee, promoter of Biniyog. Cheated, Dhar is left cursing the capital markets and his greed for super-normal returns.

The seduction of the stock market held sway over Dhar for 10 charmed months till Biniyog defaulted on two successive monthly payments. By then, it was too late for the resident of Barasat.

'The lure of high returns induced me to borrow over Rs 5 lakh from my father-in-law and another Rs 10 lakh from friends and relatives and invest in the market through Mukherjee. I have lost everything' I should have controlled my greed,' rues Dhar, who had even ploughed in income from safe assets like LIC policies to earn a quick buck in the capital market.

Over 150 fellow investors, eyeing a joyride on the upwardly mobile Sensex, join the chorus as they blame Biniyog for their plight.

Mukherjee, a 'technical analyst' with a television channel, lured clients by promising returns between five and 20 per cent per month. For the first few months, he kept his promise and more and more investors started signing up with Biniyog.

'He promised a monthly return of 12 per cent. So I thought that even if I borrowed money at six per cent per month, I would stand to gain heavily,' says Sandip Roy Chowdhury, a trader in Barasat, who invested Rs 8.5 lakh with Biniyog.

Mukherjee disappeared in May, leaving Roy Chowdhury and many others in the lurch. By then, Biniyog had mopped up more than Rs 2 crore from its investors. Mukherjee and father Smriti were arrested at a bus stop in Balasore on Saturday.

But the financial fraud has thrown up a number of questions on greed and gullibility. 'At a time when interest earnings from various savings deposits are going down ' a bank fixed deposit fetches no more than eight per cent per annum ' people are looking for options with higher returns. But why can't they understand that a monthly return of 12 per cent is too good to be true' asks personal finance adviser Alok Misra.

According to a broker with a leading brokerage house, the middle-income salaried class has begun banking on the capital market. 'The number of trading accounts has increased by 10 times in a year. But as an investor, one has to be rational in terms of demand for returns and also keep track of investments,' he warns.

Mukherjee's clients didn't get their basics right in their rush to ride the bull at the bourses and took a tumble.

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