Kendrapara, April 29: Allegations of a financial fraud, allegedly by a government-run co-operative, has shocked the residents of this town.

Residents of Kendrapara yesterday locked up the offices of the government-run co-operative society in Derabish police station area.

The alleged crime came to light when depositors found that their deposits were not showing in the account records of Palei Co-Operative Society Limited Mini Bank in Adhangamalikeswarpur village. The mini bank had 2,806 account-holders who had deposited an estimated Rs 70 lakh in various long and short-term savings deposit schemes. The investors mostly included small and marginal farmers, sharecroppers, cattle farmers, and daily labourers.

"We have received complaints that the mini bank authorities misappropriated huge money from depositors' accounts by not showing the amount in the society ledgers and accounts. We have registered cases under sections 409 <>(Criminal breach of trust by public servant, or by banker) . The employees of the society named in the FIR as offenders are, however, absconding and we have launched a search to nab them," said Derabish police station inspector Niranjan Sabar.

"We are shocked because the society was government-controlled. We never thought that we would be cheated. My signature was doctored and Rs 30,000 was withdrawn from my account," said Bijay Behera, a native of nearby Khatuapada village.

Collector Debraj Senapati said: "The registrar of co-operative societies is probing into the matter. We are taking steps against the culprits. The investors would get back their money after the inquiry."