Thiruvananthapuram: A 27-year-old man in Kerala who charmed dozens of affluent people in Kerala to invest in Ponzi schemes, has been awarded two decades in prison.
J. Sabarinath, who lured many well-heeled people into his schemes, was in his late teens when he operated the scheme in the 2007-08.
A magistrate’s court in the state capital on Thursday sentenced the youth to 20 years of rigorous imprisonment and a fine of Rs85 million (Dh4.7 million) for financial fraud.
The verdict is only for two cases that he is involved in, and there are 13 other cases that are pending in courts.
He was charged by the police crime branch with cooking up untruths and taking deposits from investors on the promise of giving them attractive interest rates.
Several people in Kerala including professionals like doctors, and those who had earned income from abroad, fell to the lure of quick and handsome returns on their wealth, only to lose even the principal amounts.
Interestingly, Sabarinath’s flagship firm was named ‘Total 4 You’. He ran some other companies, too.
In the early days he could pay high interest to new investors using money already deposited by earlier investors, but as the number of investors increased and the interest due swelled, the Ponzi bubble burst. For a while, Sabarinath convinced investors about his financial solvency by showing them bank deposit certificates.
Later, when the certificates also turned out to be forged ones, some of the investors made formal police complaints, which led to investigations on the company and the subsequent arrest of Sabarinath.
After his arrest it was revealed that he had a fleet of luxury cars and had been a permanent fixture at social get-togethers, where he mixed with the glitterati and earned their trust. He also offered high salaries to staff and was alleged to have strong connections with some political heavyweights.
The company began unravelling in December 2008 when complaints poured in and investigations began.
