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CBI nabs Arvind Johari, brother in Kalimpong

Onkar Singh in New Delhi

The Central Bureau of Investigation on Wednesday announced the arrest of Century Consultants' promoters -- Arvind Johari and Anand Johari, who were wanted by the authorities for defrauding investors and banks to the tune of Rs 1.50 billion.

The two brothers had been absconding since March this year. They had floated 25 companies to launder in money and cheat gullible investors.

Announcing the arrest, CBI spokesman S M Khan told newsmen that the two brothers were arrested from their hide out in Kalimpong near Darjeeling late on Tuesday.

They were produced before the local magistrate who remanded them to three days of police transit remand.

They would be produced before the CBI court in Lucknow on Thursday.

"On receiving complaints from investors and banking institutions against the two brothers, the Uttar Pradesh police had registered five cases of fraud and cheating against them. Police were looking for them since March," Khan said.

"The case was transferred to the CBI in April and some officers of the Lucknow branch of the bureau were deputed to locate the culprits and arrest them. They were missing with their families and were living in assumed names in Kalimpong where they were nabbed," he added.

According to him, the investigation so far has revealed that the promoters of Century Consultants, Cyberspace, Cyberton, Century Infosys and more than 20 other companies committed a scam involving Rs 1.50 billion

"They siphoned off Rs 320 million from the City Co-operative Bank in Lucknow, where one of them was a director. They duped the Bank of India to the tune of Rs 28 million by producing false supply order for selling computers to one of their own firms," Khan informed.

"Another Rs 50 million was taken from the Punjab and Sind Bank and Development Credit Bank on false pretexts. They had a unique modus operandi. They would create artificial demand for their shares and then sell them in the market and pocket the profit," he said.

The CBI has seized their 60 bank accounts in Lucknow, two in New Delhi and 36 in Bombay. But the total money in these accounts is not more then Rs 100,000.

"We have received over 300 complaints from investors who had invested their hard-earned money in various schemes launched by the duo. The number of investors, from Delhi, Kanpur, Lucknow, Bombay and other cities, actually runs into several thousand. The brothers offered 12 per cent interest on portfolio management schemes. They also had fixed deposits and a Badla Vyaj scheme," Khan stated.

Former deputy general manager of Reserve Bank of India B B Sangma, who has been with the CBI for last three years, has been helping unravel this financial scam.

However, sources in the agency said that they do not rule out more arrests. "Once the two brothers are interrogated, we would get to know the larger picture. We do not rule out the complicity of the bank employees in helping the two in getting loans from the banks," they said.

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