Small wonder, over two dozens of newspapers – daily and weekly – surfaced and financed by chit fund companies (CFC) along side half a dozen of TV news channels plus music and entertainment channels. Some of them were victims of neo-natal mortality. Prominent among them and corresponding set-ups are Sharda Group (Bengal Post, Sakalbela, Azad Hind and Kalam dailies, TV news Channel 10, weekly Parama and Khabarer Kagoz and music channel Tara Bangla), Rose Valley (daily Khabor 365 Din, TV channel News Time, film and entertainment channel Rupasi Bangla and music channel, Dhoom), Angels Group (daily Abar Jungantor), Shan group (daily Shan Bangla), Chakra Group (daily Ekdin), Rahul Group of Companies (news channel R Plus) and Tower Group (daily Pratyohik Khabor).

Of the above, Bengal Post and Pratyahik Khabor have been shut down, while the rest of Sharda group are gasping, as staffers have not been paid for two to three months. The promoter has reportedly gone underground although the CEO of Sharda media group, a Rajya Sabha MP representing the All India Trinamool Congress (AITC), is occasionally seen around. Once a compulsory companion of AITC chairperson and West Bengal chief minister Mamata Banerjee, he has suddenly fallen from the grace, especially he was chucked out from the daily Sambad Pratidin of which he was executive authority, infamous for behaving like a King Canute. ‘Have you ever thought that the so-called CEO of a media company in West Bengal getting a monthly pay packet of Rs 25 lakhs,’ openly shouted a senior assistant editor of Bengal Post, which has reportedly been sold off to a real estate tycoon, who set up over a dozen of housing estates forming a namesake joint sector company with the state government during the Left Front regime in order to get the land almost free.

In eastern India, West Bengal has the largest number of CFCs, 27 alone registered in Kolkata. According to the department of corporate affairs, Government of India, there are over 62 dubious CFCs, operating in the state, having amassed nearly Rs 15,000 crore. The SEBI was forced to swing into punitive action against many such CFCs, as also agro funds with linkages to media industry.

The ruling AITC government, especially the CM and her close confidantes like Mukul Roy, former railway minister, and Mayor of Kolkata Sobhan Chattopadhyay are in trouble as Banerjee favoured most the CFC-run newspapers by releasing ads from the government and government-run companies, while blacklisting dailies like Ananda Bazar Patrika, Telegraph, Times of India and Bartaman. With the RBI and SEBI into action against them, the AITC supremo is in a hot soup, more so as at least two MPs of her party own, or have major financial stake in CFCs, that have been caught napping.

The SEBI issued an order against Rose Valley in 2011, debarring the latter from merger of insurance and small savings schemes and specifically forbade from collecting money from investors for diversification into hotels, tourism, food and an entertainment and news channel, although the latter disregarded the directive.

The RBI issued a notification that economic offences wing of all state governments were to look into complaints from individuals who had perked money into CFCs. ‘Some individuals, firms, unincorporated association of individuals (unincorporated bodies) or marketing companies,’ RBI wrote, were engaged in money circulation schemes and ‘collecting money from the public by making tall promises of high returns, either through issue of advertisements or by sale of products.’ This was in violation of the Prize Chit and Money Circulation Schemes (Banning) Act 1978 that banned money circulation schemes. The state governments were directed to set out rules under the 1978 Act, the RBI reminded the state governments and CFCs once again in mid-2012.

The apex bank had swung into action against two CFCs Sunmarg Welfare Society (posing as an NGO) and Amazon Capital—for false information that they had the sanction from the RBI for raising deposits from the public. The RBI issued advertisements stating that it would not stand guarantee to the investment options, floated by the two companies. There are several such dubiously functioning CFCs with political strings attached. The Congress MP and minister of state for railways Adhir Ranjan Chowdhury wrote to the Prime Minister Manmohan Singh against ‘the dubious’ CFCS, whom he called as ‘cheat funds’, because they are cheating hundreds and thousands of poor people from the villages and small towns of their meagre earnings or life’s savings.’ Chowdhury is an eyesore of the AITC supremo, as her party failed to dent into the Congress citadel, Murshidabad district, where the Indian National Congress won all the three Lok Sabha seats not only in 2009, but in 2004 when the AITC won a single seat, namely South Kolkata seat that elected Banerjee six times in a row from 1991. The punitive steps against the CFCs have unnerved the CM and her party, but have come as a shot in the arm for not only the CPI(M) but Congress too as the latter is the main opposition party in the state legislature.

The AITC top boss has reasons for consternation against at least two of her party MPs — Somen Mitra and Tapas Paul — who too wrote to the erstwhile Union finance minister Pranab Mukherjee against the CFCs. Paul, a matinee idol, wrote demanding action against the ‘illegal money-raisers’ in 2010.

Needless to state, the CPI(M) has been trying to cash in on the discomfiture of Banerjee over the monetary crimes, perpetrated by the off-shot newspapers and TV news channels that have the ear of the AITC chairperson. CITU state president and Rajya Sabha member Shyamal Chakraborty, alleged a few months back that over 60 chit fund companies operating in the state mobilised an estimated Rs 15,000 crore from small investors and most of them channelised the funds collected from public into media ventures. They are pro-AITC,’ he added. Defending his party, Chakraborty claimed that the Left Front government ‘had initiated some enquiries into such dubious companies collecting funds from public promising attractive returns. But the present TMC-led Government has not been taking any measures and passed a bill in 2009.’ But, the Bill ‘did not receive the President’s assent and the present Government is not taking adequate action to ensure that it receives it,’ he added

An AITC MP, well-known for his erudition and parliamentary oratory, ridiculed the claim. ‘The Prize Chit and Money Circulation Schemes (Banning) Act 1978 directed the state government to frame rules. Am I to accept that three decades were needed to comply with the imperative? The fact remains that chit funds were encouraged during the LF regime and some have strings attached to CPI(M) biggies.’

At least one of the TV channels has close connection with a former minister and a politbureau member of CPI(M) .

What will happen to over 3,000 journalists and non-journalists and over 50,000 field staff, engaged in money-raising following the crackdown by the regulatory bodies that stick to the rule book? That’s the billion-rupee question! (IPA Service)