₹40 crore chit fund scam in Bengaluru:  Kerala couple flees to Kenya

Bengaluru

A major chit fund scam has surfaced in Bengaluru, with over 400 victims coming forward to report being defrauded of nearly ₹40 crore by a Kerala-based couple operating under the banner “A&A Chit Fund.” Authorities revealed that the accused have fled the country, reportedly escaping to Kenya on July 3 on a tourist visa.

Deputy Commissioner of Police (East) D Devaraja confirmed the fraud was unearthed after a group of victims filed a complaint at Ramamurthy Nagar police station on July 5. “The accused hail from Alappuzha, Kerala, and sold their house and vehicles at undervalued prices before fleeing,” he said, indicating signs of a pre-planned escape.

A criminal case has been registered under sections BNS 318 and 317, the Chit Funds Act of 1982, and multiple provisions of the Banning of Unregulated Deposit Schemes (BUDS) Act, 2019. “More than 400 complaints have come in so far. Most victims are from Kerala,” Devaraja noted.

Investigators are now tracking the couple’s financial transactions and bank accounts to identify the money trail and any accomplices.

Political leaders have also weighed in. Congress leader Ramesh Babu criticized both state and central governments for inadequate regulation of chit funds and NBFCs. He called for stricter oversight, accusing microfinance entities of exploiting customers with exorbitant interest rates ranging from 21% to 32%.

One investor, claiming personal losses of ₹30 lakh, said, “I’ve known them for 30 years. This wasn’t just fraud, it was betrayal. Over 700 people have been cheated.”

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