New Delhi, June 8: The CBI on Sunday night arrested Chain Roop Bhansali, the prime accused in the multi-crore CRB financial scam, soon after he was brought here along with six of his family from Hong Kong.

A two-member CBI team which went to Hong Kong last night traced Bhansali, chairman of CRB group of companies, and his family with local assistance and brought them here by an Air India flight which arrived at around 2040 hrs.Soon after the flight, AI 319, landed at the international airport, Bhansali was whisked away to the CBI headquarters for interrogation.

CBI director Joginder Singh told reporters later that Bhansali was arrested on charges of fraud and cheating individual investors and banks to the tune of about Rs 1,000 crore.

He said Bhansali would be produced in the court on Monday for securing a transit remand for onward journey to Mumbai, where further interrogation would be conducted.

Along with Bhansali, the CBI brought his wife, Manjula, his parents, two children and sister. Praising the CBI team for its efforts, Singh said it had done a good job.

On entering the room he did a little namaste to Singh, which the latter ignored. Bhansali stood behind the CBI officers for a minute and then went back to an adjoining room where the paparazzi was not allowed.

Bhansali, whose group is reported to have an office and considerable local contacts in Hong Kong, had fled the country before the investigating agency could nab him.

Preliminary investigations by the Reserve Bank of India (RBI) and the CBI revealed that Bhansali had fled the country last month after duping investors and banks of over Rs 1,253 crore raised through capital markets, public deposits, mutual funds and inter-corporate deposits.

President of investors' grievances forum and president of BJP's city unit Kirit Somaiya has congratulated the union government on the arrest. He, however, urged the government to issue an ordinance for protection of interests of small investors in the multi-crore CRB scam.

President of CRB Group Investors' Grievances Association Pradeep Bhavnani also congratulated prime minister Inder Kumar Gujral for his intervention in the matter and hailed CBI's role in taking quick action."This will give a boost to investors and infuse confidence in them. We are now hopeful of getting our money back and investors seem to be in a jubilant mood," he said.

Bhansali, according to rough estimates, had allegedly siphoned off Rs 189 crore worth of public deposits and Rs 200 crore worth of debentures apart from Rs 252 crore raised through the public issue floated by CRB Capital Markets.

He also allegedly defrauded Rs 229 crore raised through CRB Arihant Mutual Funds besides Rs 200 crore from inter-corporate deposits, RBI estimates showed.

While CRB Capital Markets owed Rs 90 crore to banks, other companies of the group had to pay Rs 43 crore to financial institutions and Rs 50 crore to cooperative banks.

The CBI probe found that Bhansali had taken as many as 25 flats for his employees on rent in different parts of the city, including those officially allotted by the Maharashtra government to some legislators.

Those arrested on Wednesday include four CRB Caps directors, a financial controller and a relative and close associate of Bhansali.

Reserve Bank decided to take action following the failure of CRB representatives to present it with a detailed status report on the company's business before the May 17 deadline.

The central bank filed a winding-up petition on May 21 in the Delhi high court, which a day later directed the official liquidator to take over the assets of CRB Caps.

The petition was filed in the Delhi high court as the registered office of the company is located in the capital. Reserve Bank, for its part, had initiated preliminary enquiries following complaints of irregularities in payments made by some public sector banks including State Bank of India, which was approached by Bhansali for grant of encashment facility for interest warrants and warrants for principal repayment issued by his company towards repayment of fixed deposits.

Close on the heels of RBI's decision to initiate action against the CRB group, the Maharashtra government ordered the setting up of a special investigating team of the crime branch to probe complaints of investors.Reacting to pleas by various investors' fora, Maharashtra deputy chief minister Gopinath Munde formed a task force of the Mumbai police to look into the complaints and trace Bhansali, who had gone underground after the RBI gave him a week-long deadline in the second week of May to submit the status on the maturity position of fixed deposits and assets.

In its order, the Delhi high court had also restrained the directors of CRB group from disposing of assets of the company in any manner and posted further hearing of the RBI petition for July 22.

Copyright © 1997 Indian Express Newspapers (Bombay) Ltd.