Calcutta, Apr 22 (PTI): The West Bengal government has set up a high-level inquiry into the Saradha group, a chit fund company whose abrupt collapse has hit thousands of depositors and agents across the state.

Announcing this, Chief Minister Mamata Banerjee, whose Trinamul Congress party has been under fire for not monitoring Sarada’s activities, said a special investigation team has also been set up.

Mamata told reporters here after a high-level meeting that a SIT under the director general of police would go into the fiasco, and a high-level inquiry under the Commission of Inquiry Act was being instituted.

The chief minister also said that a draft for promulgating an ordinance to restrict operations of chit fund companies has been prepared.

She said she had requested President Pranab Mukherjee, who had called her up on Sunday to enquire about her health, to see that the Bill passed by the previous government seeking to restrict chit fund operations, is returned to enable the state government to incorporate more stringent provisions to deal with such illegal activities.

“If the Bill forwarded by the Left Front government to the Centre in 2009, is returned within 24 hours, then our government will immediately promulgate the ordinance to that effect,” the chief minister said.

“Laws that the Left Front government had proposed, had some flaws in it and the chit fund business mushroomed during the Left regime,” she alleged.

Stating that strong laws were needed to curb the illegal activities of chitfunds, Mamata said since their operations were governed by central laws and not by the state government, “the onus lies with the central government.”

Expressing concern at the situation, she said “for quite a few years, some chit funds were deceiving poor investors promising high returns. This has been continuing since the Eighties in this state.”