Nirmal Singh Bhangoo, the controversial owner of Pearls Group, who was at the centre of a Rs 45,000 crore scam that duped nearly 55 million investors, passed away on Sunday in a Delhi hospital after spending eight years in judicial custody, reported The Indian Express.
Bhangoo, hailing from Punjab’s Barnala, had humble beginnings, selling milk in his youth before earning a degree in Political Science. His journey into the world of finance allegedly began in the 1970s when he moved to Kolkata and worked with a chit-fund company. He later joined a Haryana-based firm involved in investor fraud before launching his venture in 1980.
His company, Pearls Golden Forest (PGF), grew rapidly, amassing millions of rupees before it was shut down due to income tax investigations in 1996. Undeterred, Bhangoo went on to establish Pearls Infrastructure Projects Ltd, ARSS Infrastructure Projects Ltd, and Jain Infra Projects Ltd. However, these ventures too drew the attention of the Central Bureau of Investigation (CBI) as complaints began to mount.
Bhangoo’s business model relied heavily on a vast network of over 2.3 million commission agents, including more than 1,700 senior-level field officers, who were handsomely rewarded for bringing in investors. The Pearls Group even became a prominent sponsor of the World Kabaddi Cup, organised by the Shiromani Akali Dal-led Punjab government between 2010 and 2013.
On February 19, 2014, the CBI registered a case against Bhangoo and other key figures within the Pearls Group, uncovering a massive scam where fake land allotment letters were issued to deceive investors, leading to the collection of thousands of crores of rupees. Bhangoo was subsequently arrested in 2016.
In a bid to recover funds for the duped investors, the Supreme Court established the RM Lodha panel to oversee the sale of Pearls Group properties. According to the panel’s website, refunds have been issued to investors who had invested up to Rs 19,000.
However, the recovery process was marred by further complications. The Punjab Police revealed that despite the Supreme Court’s prohibition, properties worth Rs 1,200 crore were illegally sold by the Pearls Group. Additionally, a significant portion of the money was diverted through shell companies and invested in Australian firms, amounting to approximately AU$132.99 million.
In September 2023, the Punjab Vigilance Bureau arrested Bhangoo’s wife, Prem Kaur, for her alleged involvement in the case. She was accused of diverting Pearls Group’s assets and violating Supreme Court orders by nominating a close relative to facilitate the sale of properties.
First Published: Aug 27 2024 | 12:18 PM IST