PONDICHERRY: In a major breakthrough in the Rs. 68.5-crore scam involving PNL Nidhi Limited, police arrested the key accused in Bangalore on Tuesday.

V. Kannan, chairman PNL Nidhi Limited, his brother V. Baskaran, vice-chairman, and their wives and daughters were arrested and brought back to Pondicherry.

Prahlad Rai Meena, Inspector General of Police told mediapersons here that since the fraud came to light 15 persons, most of them directors of the now defunct company, had been arrested.

Cases had been registered against the accused for misappropriation of depositors' money and fraudulent default, the IG said.

Investigations revealed that the main accused raised Rs. 12.5 crores through PNL Nidhi to purchase assets in the names of the directors.

In addition, Rs. 31 crores was given as special loans without any security to individuals working in a sugar mill in Ariyur and other concerns belonging to the proprietors.

Jewellery hypothecated by the public had been re-hypothecated by the directors and staff in various banks.

The Inspector said the assets of the accused in Pondicherry and Tamil Nadu had been attached and their bank accounts frozen.

The total number of depositors as per the PNL records was 13,295.

The Government had constituted an authority, consisting of the Collector and Deputy Collector, to take possession of the attached properties, begin the liquidation and settle the claims of the complainants.

He said the probe done by the CID wing led by SP Firoze Zia Hussain was "one of the biggest investigations undertaken by the wing."

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