How do people fall to Ponzi schemes in Ahmedabad of all places?

I had earlier blogged about how West Bengal continues to be a thriving place for raising money through illegal ways.  Former SEBI chief UK Sinha had then remarked:

U K Sinha, chairman of the Securities and Exchange Board of India (Sebi) expressed surprise at the number of firms raising unauthorised deposits from West Bengal, a state where the new Bandhan Bank is based.

“Unauthorised money-raising is a major issue in east India. West Bengal is also the place where such mushrooming of firms has come up. The story needs to go much deeper as how such a large number of people get duped there,” Sinha said, adding the capital markets regulator has already shut down about 250 such illegal entities, with one crossing deposits worth more than Rs 50,000 crore.

“Perhaps in eastern part of India, the economic activity, job opportunity (and) growth have not been in an egalitarian or disbursed way. This has been one of the primary causes (for chit fund scams),” he said here.  Sinha added that even though one can argue that deepening of network could have been helpful, the “story goes much deeper”.

Surprisingly, there is a long history of connivance and ignorance in West Bengal when it comes to money. My post looks at the issue.

Recently, I came across this news on how people were tricked in Ponzi schemes in heart of finance- Ahmedabad. It said around 876 people have lost nearly 9 crore to 7 ponzi schemes in last 2 years. These are the official numbers as of now and actual numbers could cross Rs 260 crore.

One can understand people designing schemes to cheat people all over and people falling in those traps. But to imagine people in Ahmedabad get duped on such schemes is puzzling where understanding of finance is expected to be much better . The designers are perhaps smarter here. But even then…

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