India’s Sahara group says its employees are helping raise $US1.
7 billion ($A1.84 billion) in bail money to free the financial giant’s chief Subrata Roy from prison.
Roy, 65, was sent to New Delhi’s Tihar Jail on March 4 over a case involving the repayment of billions of dollars collected in an illegal investment scheme.
Earlier this week, the Supreme Court ordered Roy, who has a mansion modelled on the US White House, to post bail of 100 billion rupees ($A1.84 billion).
In a statement, Sahara said the move by workers to drum up the money was “an emotional initiative” by the people.
But local media reported Sahara executives had sent employees emails urging them to contribute, a claim denied by an executive of the company.
Sahara, a household name through its one-time sponsorship of India’s cricket team and owner of landmark New York and London hotels, raised 200 billion rupees from millions of small savers through an illegal bond scheme.
Regulators ordered the group to pay the money back with 15 per cent interest – even though the Supreme Court said there were “serious doubts about the existence” of the investors.
That fuelled long-running allegations the company may have been engaged in money-laundering for rich politicians.
Sahara insists the company has only been helping poor, mainly rural investors who are hard to locate.
The Supreme Court sent Roy to jail, saying it was “not happy” with Sahara’s repayment plan and demanded a “concrete proposal”.
The bail money from employees and other “well wishers” is being raised by a new Sahara unit. Donors will get shares in return.
The unit is seeking to raise half the bail amount, the Press Trust of India reported.
Roy’s entertainment-to-financial services conglomerate, based in the northern city of Lucknow, claims to employ 1.2 million people, second only to India’s sprawling state-run railway.