BJD MLA Pramila Mallick

Cuttack/Bhubaneswar, Oct. 27: State crime branch today arrested Khirod Chandra Mallick, managing director of Credible Micro-finance Limited, for allegedly duping depositors of over Rs 5 crore.

Mallick also happens to be the brother of the former minister and ruling BJD MLA Pramila Mallick.

Incidentally, Khirod was partly responsible for Pramila losing her ministerial job in the wake of the dal scam in 2011. Pramila, who was the then women and child development minister, had included her brother in the 20-member state-level mid-day meal monitoring committee.

Speaking to reporters, additional director-general of police (crime branch) B.K. Sharma said: “Khirod Chandra Mallick was arrested from Sambalpur today and would shortly be brought to the economic offence wing office in Bhubaneswar for further interrogation.”

Khirod, who also runs an NGO called the Bharat Integrated Social Welfare Agency (Biswa), had taken over as the managing director of the Ponzi firm in 2006.

The company was set up in 1993 as a non-deposit and non-banking financial company.

However, Khirod used the Biswa network to collect money from investors even though the company’s permission had lapsed.

The company had allegedly violated Reserve Bank of India (RBI) guidelines and has a liability of Rs 5.28 crore that it requires to repay its investors. Based on such violations and complaints, the RBI had written to the state finance department and subsequently the company’s licence was cancelled.

“The RBI had cancelled the company’s licence in June 2014,” Sharma said.

The RBI had earlier summoned Khirod and asked the company to refund money, which it failed to do.

Based on the RBI report, a case was lodged against Khirod by the economic offence wing on October 25.

In another development, the special CBI court today allowed the probe agency to take chairman-cum-managing director and two directors of the money circulation deposit collection company Naba Ddiganta Capital Services, on a six-day remand.

The company’s CMD Anjan Baliar Singh today said: “No one influenced BJD MP Ramchandra Hansdah and former MLAs Subrana Nayak and Hitesh Bagarti to be part of the company. There are documents to substantiate their involvement in the company activities.”