[crowd cheering]
[announcer in Hindi] Friends,
the chairperson of the world's largest family,
the honorable Saharashri has arrived.
Saharashri!
Long live!
-[announcer] Saharashri! -[crowd] Long live!
[announcer] Saharashri!
[in English] Oh, it instils such a great sense of pride in me.
[crowd continues chanting]
We felt like real champions and heroes,
felt really elevated.
We felt so proud of ourselves -
really, really proud.
[in Hindi] We shall sing our beloved anthem
with such fervor and with such dedication, without missing a syllable,
that all Indians shall feel proud and overjoyed.
[in English] His creative consciousness...
is beyond my imagination,
which is why when we call him honorable Saharashri... it is, it's apt.
He deserves that.
[cheering]
But, you know, every human...
every institution, every legend
passes through ups and downs in life.
-[horns honking] -[pulsing music playing]
[indistinct yelling]
My next guest is Sahara boss, Subrata Roy.
One of India's leading business tycoons is in a bit of trouble -
in fact, that's an understatement.
[indistinct shouting]
I challenge the whole world that we have not done anything wrong.
Not a single fraud you can get from us.
[overlapping voices]
In this case, Mr. Subrata Roy's company
had been systematically circumventing, violating the law.
The money comes from very poor people.
[reporter 1] Look in any of the small towns of the Hindi heartland
and our reporters would find those like Indu
who have trusted Sahara with their meagre earnings.
Where is the money?
[man in Hindi] The man's a thief!
[in English] Rumors have even been spread, fabricated and totally baseless.
[reporter 2] At this point of time, the facts seem to be loaded against you.
If they can find out one thing, in the last 32 years,
Sahara has done against the law,
they can hang me.
[music crescendos]
[theme music playing]
[music fades out]
The name is ubiquitous,
you see it everywhere -
in the skies, on satellite TV,
in multi-megaprojects,
and even on our boys in blue -
Sahara.
But who is the man behind it?
Rated amongst the most powerful in the country,
he's also an enigma.
I am delighted to meet Saharashri, Subrata Roy.
Thank you so much for coming. It's my pleasure to have you here.
Thank you for calling. Thank you.
You know, so dizzying has been the speed of your success
that we haven't had time to find out,
who is this man, Subrata Roy?
What kind of a person is he and how did he do it?
Well... I'm a simple human like any other.
[gentle instrumental music playing]
[man] Subrata Roy was always really ambitious.
But the story of this man,
the son of a lowly civil servant,
originates in the middle of nowhere in Gorakhpur in eastern Uttar Pradesh.
It is, economically, the most backward part of India.
He started Sahara in 1978,
but before he did this,
he tried his hand at almost everything else,
you know, from selling snacks to selling fans.
I mean, he had all these enterprises that he had his fingers into,
but he-- most of it failed.
In the early days,
he started schemes
where he would take money from ordinary people.
These people who were underprivileged who didn't hold permanent jobs,
didn't have a permanent address of their own,
and he would promise them a certain return
under various terms and conditions.
They were called "chits".
[Paul] Nineteen seventies, eighties,
that era, there weren't that many banks.
Rural folk had no access.
But they did earn money, you know,
little small sums, and they did want interest.
[motorbike engine puttering]
[Paul] Along came Subrata Roy,
this 30-year-old guy
going on a Lambretta scooter from door to door.
He saw there were thousands and thousands of small depositors.
So, for as little as ten rupees and fifteen rupees,
they were able to invest into these schemes.
Over a period of time, these small depositors
would be getting interest, they would be getting some benefits.
Many of them thought that this was akin to a savings scheme in a bank,
so they could use it when they needed it, uh,
for a wedding in the family, for somebody's illness, or whatever.
I don't think they even read the fine print...
because those who availed of those schemes
were individuals who...
couldn't read.
[motorbike engine puttering]
[woman] Here was this fascinating man who comes out of nowhere,
who embodies the small-town man.
He had this remarkable ability to understand exactly what you needed,
and he was able to grasp that
and to, sort of, pull you in.
[loud crackling]
[Indian instrumental music playing]
[Bamzai] But also, he's a guy who understands India very well.
[indistinct overlapping voices]
[Bamzai] Over the early years for Sahara,
this huge wave of liberalization sweeps India.
The economy was booming, markets were looking up...
Everything just looked as if it was India's moment.
[music continues]
But there were many other people, sort of, left out or marginalized
by this huge wave of liberalization as well.
He understood that point and he was able to give them...
a way to make money.
"Sahara" actually means "savior," so he was their Sahara.
[cars honking]
[man] I've been an independent journalist for a long time.
I followed this story more than 30 years.
Is that an official Sahara document?
Initially... he would say,
"OK, deposit ten rupees a day, fifteen rupees a day
and your money will become two times in three years."
[in Hindi] I started by investing twenty rupees a day,
and then as my business grew, it kept going up.
So, I started investing 50 rupees, and later, 100 on a daily basis.
The best is that we kept investing small amounts of money.
We got more back, which helped grow the business.
[Pradhan in English] I won't deny that, in the beginning,
people did get their returns.
It was fantastic for them,
which is how he built his credibility.
I got interested in this because one thought,
there has to be something wrong somewhere, there has to be something shady about it.
How can you get so much?
But there used to be huge hoardings all over the place
saying, "OK, this scheme will give you three times money in this much..."
So, it looked very unreal.
What prompted a stranger to hand you over his or her life savings?
Many people, they never thought of saving,
so I used to tell them that if you save small, small amount...
Most important thing in friendship is the trust.
[in Hindi] I remember when I went to the office
to fill out forms to become an agent, the manager told me
that... Sahara is a very good company
so you don't have to worry about it.
There was no training as such,
but first, you have to become an investor yourself,
and then you can become an agent.
[indistinct chatter]
[woman 1] She became an agent
hoping to get ahead of the life she was born into.
She said, "Mummy, can you find me people to invest?"
So, I informed everyone, they all knew Punam as well,
so they all agreed and invested.
[indistinct chatter]
I said "Yes, let's all do it.
No reason not to."
[in Marathi] We invested $4 monthly.
[woman 2] I couldn't afford that much.
I couldn't afford that - I'm only a cleaning woman.
You need it for your old age so you can look after yourself.
[Punam in Hindi] I was not on a salary with Sahara,
but I got an agent's commission.
So, it was all about, "get more investors, get more investors."
I tried to convince all the people around me,
like my neighbors, my colleagues, and my relatives.
The people knew me and my parents,
so they were OK...
they had faith in me.
[indistinct chatter]
[Kondu] They invested because they had faith.
It's not like it's a small company, right?
It's like a family.
[Roy in English] It's always nice to be a family community.
That binds you emotionally, that-- that community.
-[woman] Mm-hmm. -It really binds you emotionally.
[Bamzai] For Subrata Roy, the family is a very powerful idea.
And I think he knows,
that really taps into something very deeply Indian.
It taps into our psyche of having someone to look after you.
[man] Sahara India Pariwar...
[Pradhan] He loves to call it "the world's largest family,"
Sahara pariwar.
"Pariwar" means "family" in English.
If you look at their advertisements,
even the advertisements would depict the kind of culture that they follow.
That's a very smart way of... [chuckles] doing it, and smart he is.
[Bamzai] His kind of business model,
he calls it "collective materialism."
It's a very clever mix of modernity and tradition.
So it says, "OK, so, you are on your own,
you are a migrant in Lucknow or in Delhi,
you've left your family behind in the village,
but, hey, I'll look after you, I'm your new family."
[pulsing music playing]
He creates wealth for everybody who works with him.
Here are people that you wouldn't even look at...
the lowest of the low, the people who have nothing.
He's picked up so many lost causes and he would give them a responsibility
and he would see to it that they really grew into that job.
There are various ways of doing business.
His way of doing business is to project a very altruistic approach.
It makes people work harder.
It makes people more loyal.
[indistinct chatter]
[in Hindi] Sahara is doing a great job, so I thank them wholeheartedly.
[in English] He married off a hundred couples at his own expense
and gave them five lakh rupees each or something to start their lives.
[in Hindi] It's a very good thing for us, very emotional as well.
We feel very happy and contented
when 101 unmarried girls get married.
[in English] Here was a person who claims to be Robin Hood
because he's, uh, helping the poor.
He was somebody who was clearly above board.
Why would people not invest in his chit fund?
Of course, they would.
[pulsing music playing]
Subrata Roy's genius was he understood the value of scale -
that if you're taking a couple of rupees, ten rupees here, twenty rupees here
from very poor people, it's hard to make money.
But India's an enormous country,
so if you do that with a million people,
with ten million people, with fifty million people,
suddenly, you can take small beginnings
and turn them into a sizeable business empire.
[music continues]
[Crabtree] In the beginning, everything seemed to work wonderfully.
The money that is coming in
is funding the payments that are going out.
But, ultimately, this was a form of pyramid scheme
because the returns on paper that were being given to original investors
were only really being made
because more and more people were being enticed into the system.
And so, Subrata Roy ended up employing hundreds of thousands,
nearly a million agents, all across India,
whose job was to find more and more poor people
and to get them to sign up to this.
[music continues]
And as long as people kept doing that, then the returns kept coming in.
[music fades out]
When I joined this lovely organization,
Sahara was an absolute patriotic organization,
working for the nation -
a very Indian company with a lot of Indianness in it.
Whatever I am today in my life is because of this organization
and my good honorable Saharashri.
I was such closely associated with him.
His arrival would, first of all, instill a lot of respect.
The first sentiment or the first chemical secretion,
which would happen up here,
would be of submission.
I have seen people not just touching his feet,
I have seen people lying down on the floor and touching their forehead to his shoes.
Subrata Roy definitely suffers from a god complex.
I wouldn't say god,
but what we call in India a "guru".
Guru would be more towards being a master,
where you're taking and receiving and perceiving knowledge from someone
who is by far superior to you.
When I met him first,
uh, it was interesting that he told the photographer
to take a low angle,
so you could see this gigantic figure
under this massive chandelier.
The whole image was of someone who is so powerful
and someone who is clearly above you.
From the earliest days of the business,
Subrata Roy fashioned around himself a personality cult.
He had his staff call him "Saharashri" or the Managing Worker of his company,
he always dressed the same way
in a uniform with white socks and aviator sunglasses.
[Paul] They came up with these traditions which brought in a uniformity of behavior.
They devised this whole "Sahara pranam."
They'd put their hand on their chest and they'd say "Sahara pranam."
We used to have to say "good Sahara" like that, or "Sahara pranam."
We used to have to touch our chest on the left side.
[Kumar] This binded the entire group under one umbrella,
under the umbrella of family.
It was such a large family.
-[overlapping indistinct voices] -[whistling]
[Bajaj] For many of the Sahara family,
he gave them their first pair of shoes.
They said, and I have seen this myself,
they said that, "Listen...
my daughter got married because I invested in Sahara."
"My son today is an engineer because I invested in Sahara."
"My son is a pilot because I invested in Sahara."
"We trust Sahara completely and totally."
Now, when you have been so transformative
in the lives of people,
they will put their forehead to your toes.
[indistinct chatter]
I'm sure Subrata Roy considered himself absolutely invincible.
[in Hindi] Who was your agent?
Here is the agent.
[Pradhan] How much is he owed now?
Four and a half to five thousand dollars.
Sir, it's because the original deposit, in his case, has been reinvested.
[in English] What I have discovered was happening, in the initial few years,
he did return money to the people,
and-- but what he did, what gradually he switched to,
was impressing upon people
not to take back the money, to reinvest it.
[in Hindi] I see, I see. A multi-- A super multiplier.
[in English] When you deposit the money,
you are told that this money will become double in three years.
At the end of three years,
you are told, "We have another scheme which is even more lucrative."
"If you put 10,000 rupees, you will get 30,000 rupees."
For a poor man, it was like a gold mine - 30,000 rupees in three years.
Then, the fellow deposits the money again
and, yet again, when that majority comes,
he's told, "OK, now you put this money in..."
they had some fifteen-year scheme
in which the money was supposed to multiply six and a half times.
Because the returns were so good,
uh, your taxi driver or your roadside stall owner
wouldn't take the money out -
they just let it roll over to the next year.
And so the pot of money
that had been invested by everyone kept growing.
He had been very successful
in raising capital from the poorest people in India,
he had lots of money.
The question was, "What do you do with that?"
[man] Ladies and gentlemen, please fasten your seatbelts,
sit back, and experience Air Sahara.
[Crabtree] He began to use that money to buy up all sorts of other assets.
[man] Air Sahara,
part of the US $4.08 billion Sahara India Group
that has interests in Public Deposit Mobilization.
He became India's largest property owner by some measures.
He began to invest in hotels, both at home and abroad.
Indian billionaire Subrata Roy has bought the luxury Plaza Hotel
on the iconic Fifth Avenue at Central Park in Manhattan.
So, in a sense, he was using the money
that he was raising from some of the poorest people in India
to turn Sahara into a broad-ranging conglomerate
that was focused on the Indian and global middle class.
Aamby Valley City is a creative expression
of our beloved chief guardian, honorable Saharashri.
Aamby Valley.
It is not a real estate product.
It's, of course, a place for people who have actually arrived in life,
no doubt about it.
It's a different order of living.
[man] Aamby Valley is a megaproject.
They have facilities out there, uh, that are like no other.
You have hotels, you have chalets for sale,
many themed restaurants all over the place.
There's one thing that I remember about Aamby Valley
which is, in the evenings,
there's a sort of dancing fountain, sound and light show.
As the fountains are underway,
we actually see this hologram of the man himself, Subrata Roy.
[Bajaj] He wanted to be the biggest industrialist,
the biggest businessman,
the number one man in India.
I came along to launch a huge television network for him -
the kind of network that India had never seen before.
The first thing he said, "You gotta color your hair."
I said, "Listen, but I've been appearing on television before
and I've got silver-grey hair."
I-- I turned silver-grey as soon as I came out of school.
He said "I don't care...
You have to color your hair black because I color my hair black."
[speaking in Hindi]
[in English] Here is this man who also built an entire city
as a tribute to himself in a way.
[Ailawadi] Sahara City is this 360-odd-acre compound.
It houses Subrata Roy himself and a few hundred of his employees.
The building that he lives in is actually the size of the White House,
and it looks very similar as well.
The rest of the compound has a number of facilities -
a helipad, a golf course...
Right through the city, you find all his obsessions in a way,
so he's Walt Disney of this fantasy land he's created.
[Paul] When I was growing up, he was everywhere.
He was the poster boy of everything glam and glitz.
[man] Sahara India Pariwar.
Cricket in India is sacred.
Cricketers are like gods for Indians,
and the fact that you have your heroes wearing a Sahara shirt,
that's quite a statement to make.
[indistinct chatter]
You see, when glamour is added,
it's a big thing for individuals, for the organization, for the country.
So, that's really good.
[instrumental music playing]
[Jamvwal] I'd call him magnetic.
He had the grandest parties,
he surrounded himself with the glamourous and the rich.
[overlapping voices]
All the famous drawing rooms of India welcomed him. Why?
[indistinct chatter]
[Jamvwal] His story appealed to everyone.
It was a story, you know, of this man who just came from nothing...
and, you know, lived a life that everyone dreamt of.
[Bamzai] It was very important for him to build this whole image
of being someone who's on first-name terms
with the most powerful people in India.
[Jamvwal] Amitabh Bachchan...
he is the greatest and the most long-lasting actor in India.
The guy has become one of his best friends.
So, if you remember the 2004 wedding,
there was a wedding of his two sons.
He had the prime minister of that time,
he had the chief minister of Uttar Pradesh...
he had some of India's biggest superstars...
beginning with the biggest superstar, Amitabh Bachchan.
Ten thousand people were at that wedding in Lucknow.
[Bajaj] I was there.
Nothing like it had ever been seen,
and India is a land of grand weddings.
There has never been anything so extravagant...
as the Sahara wedding... ever.
It was mind-boggling.
But I think that's what...
put up the backs of a lot of people.
It was too lavish.
It was grandiose.
[musicians playing instruments]
Some people did wonder...
"How did he get this amount of money?"
[drums playing]
[Bajaj] Did we wonder, "How is it that all these things are being financed?"
We knew how they were being financed. I mean, there's no secret to it.
It was the chit fund.
What always irked me most
was that he was thriving on the money and savings
of extremely poor people.
It was their money.
In terms of what was wrong,
you could talk about what was ethically wrong,
but, uh... but legally, at that point,
there wasn't any particular violation that was brought to light.
[drums continue]
[Ailawadi] As Sahara wasn't a public company or a listed company, right?
So, if you were a listed company,
you would come under the purview of the regulator, the official regulator.
When you reach their heights,
yes, you can bend a few rules and get away with it a lot
because you're up there and you're one of the powers that be.
But you have got to hold it together
because the moment you feel that you're unimpregnable,
that nothing touches you,
that your burnished armor can't have any chinks...
I mean, that's the beginning of the end.
[indistinct chatter]
[Pradhan] During that period, not a single newspaper in the country
would write a word against him
because he would flood that media house with his own advertisements.
It was not easy to expose him
because of the, kind of, uh, the net that he had spread,
the clutches that he had over the media barons.
I would get agitated by this,
and the agitation would grow more [chuckling]
when you realize that your story would not be carried in the paper.
But, at that point of time, I discovered that a modus operandi was adopted.
[indistinct chatter]
There were cases where in remote, remote places
the agent would stop knocking at your door and you would be told,
"OK, now, henceforth, the depositor will have to make his daily deposit
at the nearest Sahara office,"
which, invariably, would be at some distance.
-[in Hindi] The office at Barabanki? -Yes.
-[Pradhan] The district office? -Yes.
The journey will take him the entire day.
[in English] Now, as a daily wage earner, you know, they are such poor people...
[indistinct chatter]
[Pradhan] ...it is practically not possible
to be so religiously ensuring that ten-rupees deposit every day.
And then, when people would miss payments,
and a number of defaults were committed on account of missing the payment,
he would receive a letter.
"Look here, you've made so many defaults and if you make more,
your money will be forfeited..."
which is precisely what happened to people.
But, of course, people started thinking,
"this is shady, there's something wrong,"
and that is what started dissuading depositors.
For Sahara, this was a huge problem.
These kinds of schemes succeed
only as long as you have more and more people rolling in.
As awareness grew,
and as experience started telling people that this money's not safe,
the numbers started depleting,
and as the numbers started depleting,
he had started facing a crisis.
Hello and welcome to Walk the Talk.
I'm Shekhar Gupta and my guest this week,
somebody who tries very hard to stay out of headlines,
but there are millions of rumors about him.
The real Mr. Subrata Roy, Saharashri.
-Welcome to Walk the Talk. -Thank you.
-How many depositors do you have now? -Six crores plus.
That means almost...
one in 20, one in 15--
-One in 17. -One in 17 Indians.
Many of whom are very poor people.
You feel a special sense of responsibility?
Very much.
That is the first responsibility I have.
[Crabtree] In the middle of the 2000s,
you began to get stories of people
who tried to get their money out and couldn't get it.
In a normal pyramid scheme,
often these things collapse overnight and it wasn't like that with Sahara.
His problems actually started when he tried to take his companies public.
When are you planning to go public?
Because one thing about Sahara,
one thing that adds to the mystery around Sahara, or mystique,
is that very little is known in public domain.
So, if Sahara goes public, or one of your companies goes public,
it will be big news.
When does the first one go public? Which one goes public?
I think, from now,
within six to eight months we will definitely go public.
-Which company will go first? -Housing and Infrastructure.
[Ailawadi] It's a massive change.
All of his companies until this point... were private.
Now, obviously, when he decided to go public with two of them,
he wanted to raise fresh funds.
[inaudible]
-You now intend to list your businesses? -Yes, we will do this.
And you're doing this to unlock value
or you're doing this also to-- to counter this mystery?
-The aura-- -[chuckles] Both.
[inaudible]
Now, when you do go public,
you would have to reveal a certain number of things,
make disclosures,
um, obviously, talk about where you are raising the funds from,
what you're going to do with those proceeds.
You have submit audited accounts as well,
so it's at this point that people started asking questions.
Mr. Subrata Roy was always, sort of, one step ahead
in the early days of his, uh, career as a businessperson
in being able to, you know, sort of,
devise schemes which would be on the right side of the law.
And, he was able to do all this
until he finally ran foul of certain officers
in India's regulator of the financial markets,
SEBI, or the Securities and Exchange Board of India.
-[indistinct shouting] -[car honking]
[overlapping voices shouting]
[reporter] Sahara boss Subrata Roy who's in a bit of trouble -
in fact, that's an understatement - one of India's leading business tycoons,
he has juggled all kinds of various ventures,
but today, uh, he has faced some very uncomfortable questions
from market regulator SEBI.
And so, India's financial regulators began to look
at the structures that he was using and say,
"Well, this doesn't look exactly right.
Um, it appears that he's not being transparent about who his investors are
or the rules under which they are allowed to get their money back."
Sahara claims SEBI has no business summoning their chief.
[Crabtree] And so, beginning in the mid-2000s,
there was an ongoing battle between Sahara and India's regulators
as they tried to figure out exactly what the monster was that he had created.
[overlapping voices shouting]
[reporter 1 in Hindi] Sir, what questions did SEBI ask of you?
[Roy] They asked us about our assets.
I had hoped we would be at least offered a cup of tea.
We didn't even get that. Thank you.
[reporter 2] SEBI's accusation is that companies of the Sahara Group
have raised $3.5 billion from investors illegally.
[in English] It was only when the SEBI came into the picture
that the media started writing things about him.
Senior journalist Sharat Pradhan,
who knows the story like the back of his hand,
joins us tonight from Lucknow.
Sharat, I want to go to you first.
[Pradhan] I felt very elated, you know, very happy.
And then, of course, whenever one got the opportunity,
they made it a point to speak out.
Almost all of his money comes from very, very poor people,
who do not have the courage or the means or the ability
to question where their money has gone.
[Thakurta] If you go through the records
of the Securities and Exchange Board of India,
you'll find there's a long list of allegations against him.
He fought the battle all the way up the legal ladder
to the Supreme Court of India.
It so happened that I just got a call from a lawyer in Delhi
who was the lawyer for the Securities and Exchange Board of India.
And he asked me whether I could appear against the Sahara group of companies
and would there be any conflict of interest.
And I said, "none."
I took it as a very big challenge
as I was going to appear against most of the leading lawyers in India,
the best of the best in the Indian bar.
I can claim challenge to the whole world that we have not done anything wrong,
not a single fault you can get from us.
I can challenge that.
And I'm challenging it-- uh, publicly, I'm challenging it.
[Datar] The law in India is that if you collect monies from the public,
you have to be very sure that you comply with the stock market regulations.
You don't take money from the public and not comply with the law.
Sahara collected huge amounts of money from investors.
So, we asked,
"Please, explain to us why you are not coming under the jurisdiction
or the control of the stock market regulator."
He said that, "What I am doing is not technically a public issue.
Sahara investors are people
who are part of the Sahara family, Sahara Group,
so it is a private matter - it is not involving the public."
But the point is, there were approximately thirty million investors.
It was staggeringly large...
for so many investors in one particular company,
and that was a major bone of contention.
It would be, uh, paradoxical to say
that you're going to collect money from thirty million people,
perhaps the largest public issue in Indian history,
and say, "No, the public is not involved - it's just a group of private people."
[indistinct yelling]
In this case, everyone--
the common perception is that Mr. Subrata Roy's company
had been systematically circumventing, violating the law.
He is some kind of a megalomaniac.
[indistinct chatter]
[Roy] Listen, I promise,
when I come out, when I come back out,
I'll talk to everyone then.
[indistinct shouting]
[Pradhan] He was claiming, this was a matter for the Sahara company
and not the regulators.
It was a very insolent kind of behavior on his part.
"You cannot do anything against me."
The Supreme Court issued him warnings.
"Look here, we are not sitting here to hear all this nonsense from you."
But, here is a guy who managed to fool everybody,
for a long, long time.
So, the next thing that happened,
I'm sure Subrata Roy never thought that this could happen
because he was-- considered himself absolutely invincible.
[banging]
The order came on the 31st August of 2012.
[dramatic music playing]
The Supreme Court held that it is a public issue
and since you have not followed the legal requirements,
they directed Sahara to refund the entire money collected to the public...
[overlapping voices shouting]
[Datar] ...approximately 250, 260 billion rupees.
The original investment plus 15 percent interest -
$3.6 billion dollars.
This was the largest ever financial penalty
that had ever been recorded in India.
I was really very happy that, at long last,
this man has got what he deserved long ago.
And hats off, salute the Supreme Court.
[music fades out]
[Kondu in Hindi] When that all happened, it got reported on.
It was on TV and it was in the papers.
Then it becomes a little scary.
[indistinct chatter]
[Kondu] You get worried.
[indistinct overlapping chatter]
I reassured people...
told them not to worry.
[Punam] At that time, I read that SEBI had given instructions
to refund the investors' money.
But, by the time SEBI became aware, it was too late.
Sahara had been calling up their agents like me,
telling us to ask our investors to reinvest their money
because there are problems with the existing accounts.
So, it was better to deposit it into another account
and earn good interest on it.
[reporter in English] Surindra Sinha, who subscribed to one of the schemes
now banned by SEBI,
he says he has not been refunded
but made to switch to a new scheme called "Q Shop".
[in Hindi] My feeling is...
it was done knowingly as a scam
because they wanted to withhold the money from the investors...
and that's how Sahara tried to show in their books to the government
that they had already given investors their money
when, in fact, they shifted the money to different accounts.
[in English] We have nothing to repay because repayment was done, made
before the judgement came,
before that, it was ours.
They said that Mr. X, Mr. Y, and Mr. Z had been refunded
and we've got documents to prove that.
They didn't say cash or check order initially,
just that they had repaid the money.
Some say, they have been merely moved from one scheme to another.
Eventually, the story came that, "Look, we refunded the money in cash."
[reporter] Not long after the order,
Sahara made a startling claim that they had repaid almost all the money,
20,000 crores,
back to the investors in just a few months,
eliciting this remark from the SEBI chief.
A particular company has claimed
that it has refunded more than 20,000 crores...
to so-called investors, out of which,
more than 90% has been returned in cash.
I would like all of you to ponder and think
how feasible, how credible this story can be.
Go ahead.
Go for the investigation, go for inspection, go for checks.
We are open book.
And, uh, so, we said, "Show me the money. How did you refund the money?"
When the market regulator demanded proof,
he put documents into thousands of boxes,
packed them into trucks,
and had them come all the way into the headquarters
of the Securities and Exchange Board of India in Mumbai.
Here you are at loggerheads with the government regulator,
you're being pushed from all sides,
and you show your bravado by sending 127 trucks,
coming in the middle of the night,
with 31,000 trunks of documents.
[Thakurta] He knew full well
that it would take the regulator
many months to scrutinize those documents
and establish their authenticity.
And I do believe that it was an indirect way
of intimidating the market regulator.
[reporter 1] Sahara says the proof is in the five crore documents,
sent in 127 trucks to SEBI headquarters.
SEBI says it's a claim which is almost impossible to verify.
They have kept the documents at this warehouse in Navi Mumbai
where they are being studied by a group of 45 to 50 people
with 80 scanning machines.
But they say that the material has been sent
in an almost incomprehensible way,
with the names of the depositors in one box
and the refund vouchers in another box,
as if to deliberately make the task of verification even more difficult.
When the regulator did go through these boxes,
there were a lot of names that came about which didn't have proper records -
there was no proper address matching those names.
A lot of those names showed up two to three thousand times,
uh, with very generic names, sometimes names of cities,
and that doesn't happen usually in India, right?
You're not going to have someone named Mumbai.
[reporter 1] When SEBI wrote to 20,000 sample depositors
asking them to apply for a refund,
only 68 wrote back, less than a percent.
Sahara were claiming that they had all of these investors
and it turned out that perhaps they didn't have these investors,
perhaps the names of the investors they claimed to have had been made up.
[reporter 2] There's a huge controversy, Mr. Roy.
SEBI says, all these people
who you claim as your investors are all fake.
SEBI says, it wrote to 20,000 sample depositors...
only 68 wrote back.
Subrata Roy, if these are real depositors...
should they not have written back?
Now, tell me one thing -
the persons, small persons,
who have got back their money,
why should they respond to SEBI's letter?
The question that was on the mind of most people was,
"Where are those depositors?"
[reporter 1] A sample of the names and addresses
of Sahara investors submitted to SEBI
do not appear genuine,
further confirmed on the ground by our reporters.
[in Hindi] I have asked all around.
There is no one by that name living here.
[in English] So, the regulators at that point thought,
"Maybe there's a different problem here.
Perhaps these investors never actually existed
and the money that was coming into Sahara wasn't coming from small investors at all,
it was coming from other sources."
With full confidence I'm telling you,
nobody on this earth can prove right as wrong.
Nobody can do that.
Subrata Roy, of course, claims that these are all bona fide depositors,
the government agencies say that they are not,
these are phantom depositors,
and it's a way of funneling black money and money laundering -
it was a route that was used.
Is the high-profile, sprawling Sahara business group
guilty of running chit funds as a front for black money?
[Crabtree] Well, that's the mystery of Sahara.
Allegations of money laundering have never been conclusively proved,
but certainly this is what was alleged by India's regulatory authorities.
Various types of news are being published
without caring to gather proper information from us.
In this context, all I can say is that
whosoever is indulging in such loose talks
are fabricated and totally baseless.
[Ailawadi] Every day, we opened the newspaper
and we saw these long, very lengthy, verbose,
sometimes emotional responses by the Sahara Group.
And as journalists, everyone was receiving press releases as well,
which were actually titled "Emotionally Speaking".
He was refuting every allegation
and also challenging the authorities
to prove that they had done anything which was against the law
and against "the spirit of the law".
I remember those words very clearly.
If they can find out one thing
that in the last 32 years
Sahara has done against-- anything against the law or the spirit of law,
if one thing they can come out with,
if they can come out with one case
that Sahara's done a black-money business, one rupee,
they can hang me.
Are you worried?
You are putting our advertisements,
you have made this a whole issue of, you know, nationalism,
you painted yourself as a person, you know, who might be in a tight corner
but who represents the values of this country etc.
How can you fight back?
At that point of time,
I realized and felt
that Sahara should do something which instils a sense of patriotism...
which binds the organization, which binds the nation,
does something good which brings a smile to everyone's face.
We worked for almost... three weeks,
day in and day out, a lot of coordination, people coming from different stations,
different small cities, buses filled with people.
Everything was so, you know, clinically done.
[man speaking in Hindi]
[in English] By having the largest number of people sing India's national anthem,
you could argue that Mr. Subrata Roy
and his associates
sought to convey an impression that they were too big to fail -
that if they failed,
hundreds and thousands of jobs would be lost.
No.
No, I was next to him.
No, not at all.
You are trying to do something for the nation,
you are not doing anything for any benefit.
There's no objective, there's no agenda.
[Roy over speakers] Five, four, three, two, one...
♪ Thou art the ruler Of the minds of all people ♪
♪ Dispenser of India's destiny... ♪
[singing fades out]
For Subrata Roy,
emphasizing the whole idea of being part of a collective,
part of something much bigger,
that was a very important message to communicate to people
at a time when there was a lot of suspicion
around exactly what business he was in, exactly who he was.
[in Hindi] One point one million people singing. What was the idea behind this?
It had to be done, had to be done. So, it was done.
[in English] He wanted the world to believe that he was the ultimate patriot,
but, clearly, this argument
did not cut much ice with...
the regulatory authorities.
[reporter in Hindi] As far as your ongoing disputes with SEBI,
the Supreme Court has clearly ordered that you should return the money.
The money, we have already paid it out, in cash.
[Thakurta in English] He tried to bluster his way through...
[indistinct shouting]
...but his arrogance didn't help him.
[in Hindi] They say I'm in contempt. [in English] They are in the contempt.
[in Hindi] But they are government goons - they may do what they want.
They are whimsical, fanciful, egoistic and greedy.
[overlapping voices shouting]
[man shouting] The man's a thief!
[faint indistinct shouting]
[reporter] Sahara chief, Subrata Roy,
has had black ink thrown on him outside court today.
He's a thief!
[reporter] The person who splashed ink on Subrata Roy's face
is saying that Sahara chief, Subrata Roy, has embezzled people's money.
He says he did it because people's accounts have been looted.
[Bajaj in English] I met Subrata Roy in Lucknow.
I told him, "Sir... they are closing in,
and the usual methods here are not going to work.
I mean, come on, what are you doing?
We don't have to get everybody's back up.
You can't attack the Supreme Court of India,
the income tax, the parliament and everybody else.
You can't do that.
The Supreme Court is really and truly angry."
Well...
he listened for exactly two and a half minutes.
Then, you know what happened.
[reporter in Hindi] What's going on? What are your orders?
We have a warrant for his arrest.
[reporter] For whose arrest?
Subrata Roy's arrest.
[in English] When the news of the arrest broke,
I remember media channels went-- all newsrooms went into a frenzy.
-[car honking] -[indistinct shouting]
High drama in Lucknow today
as one of India's most flamboyant tycoons, Subrata Roy, is arrested.
While there was always talk
and there were murmurs that this could happen,
no one fathomed, no one expected this to happen.
He didn't show up for a hearing, he didn't comply with the court's order.
He said that it was because of his ailing mother
and this was in contempt.
[reporter] Subrata Roy's lawyer told the Supreme Court
that he was unable to appear
as he was by the side of his 92-year-old mother
who was in a critical condition.
He wrote for the court's benefit "nothing is more than mother."
But the same day he apparently attended a wedding in Lucknow,
according to photographs that appeared in the local media.
[Bamzai] Contempt of court was certainly a lesser charge.
But my gut reaction when he was arrested was "about time,"
[chuckles] and "how had he not seen it coming?"
[reporter 1] He could have sold his assets worth 20,000 crores
and paid the money, but didn't.
It is deliberate deficiency of Subrata Roy not to obey the court orders.
[reporter 2] He failed to explain why his company has not refunded
the 24,000-crore rupees it owes to over three-crores small investors.
The Delhi police brought Sahara chief, Subrata Roy, here at Tihar jail.
The Tihar jail officers have said that he will be kept in jail number three
and no special privileges will be given to him.
By the way, until this case happened...
until such time as Saharashri was jailed...
there was not a single check of Sahara which had bounced,
they had not defaulted on a single payment to a single investor.
And I know that for a fact.
[Punam in Hindi] When Subrata Roy was in jail, I got a call from Sahara.
I said, "We do not want to reinvest.
Return the money because these are very poor people.
They trusted me and I don't want to break their trust."
[ringing tone]
[receiver clicks]
-[man on phone] Hello. -[Kondu] Hello?
-[man on phone]Yes? -My name is Prabhavati.
-[man on phone]Yes? -Is this Sahara's office?
[man on phone] I will connect you.
Ah...
-Sa-- -Is this Sahara's office?
Is this Sahara's office?
He said he's connecting us soon.
[on-hold music playing]
[Kondu] We want our money.
It shouldn't be like this.
It's one thing for this to happen in small families,
but they are a big company.
They took the public's money, asking them to invest.
They assured the money will get doubled,
more than doubled,
but how could they do this to us?
[music continues]
[dropped call tone]
-It's disconnected. -It's disconnected.
Not responding.
[automated voice in English] The service to the dialed number
has been temporarily withdrawn. Thank you.
[reporter in Hindi] Subrata Roy is going to have many sleepless nights.
The Supreme Court's ultimatum has sent him straight to Tihar jail.
He can still be let free
provided he presents a concrete plan for the reimbursement of money owed.
[Paul in English] Here was Subrata Roy, this extremely enigmatic,
big business tycoon in jail.
I remember we were all, you know, running helter-skelter,
and, um, I struck a rapport with his team members
and persuaded them to allow me to meet him.
He seemed quite hurt.
He firmly believed that his detention was illegal.
He also firmly believed that all his depositors were bona fide
and, um, this was a conspiracy that was being hatched against him.
He was, um, quite concerned about putting on weight.
He had a yoga instructor coming in early in the morning
who would guide him through his asanas.
[laughing] Oh, that.
I mean, I was-- what again surprised me and amused me
was that he wrote a book from jail.
He wants to project himself like a freedom fighter
who went to jail, who goes to jail, and still has great pure thoughts.
But this is not a book written by Mahatma Gandhi in jail,
[chuckles] or a freedom fighter,
this is somebody who the Supreme Court has described as a rogue.
[in Hindi] For the last three years,
the company has not been paying out at all.
I haven't even been able to get my father's paralysis treated.
He's been bedridden for almost three years.
[man] Sir, this has been going on with everyone.
Her husband had a brain tumor.
She went to the Sahara office many times.
Eventually, her husband passed away. The company did not return a single rupee.
[woman] I told them everything.
I showed them the medical reports from all the hospitals.
But they said, what can they do without the money?
They said, "The scheme has matured,
but if we don't have the money, how can we give it to you?"
[Pradhan in English] I've been to places where hundreds of people...
came forward, telling me the same common problem.
Subrata Roy may have gone to jail,
but fact of the matter is that most of the depositors
who shelled out all their savings,
they never got their money back.
All across the country, they are at a complete loss.
[reporter 1 in Telugu] At the Sahara finance office in Kurnool,
people impacted by this organization have come out
saying their money has been taken as fixed deposits.
[man shouting in Hindi]
[reporter 2] Approximately $150,000 has been taken by this branch alone
and not returned.
[men continue shouting]
[reporter 3 in English] Look in any of the small towns of the Hindi heartland
and our reporters would find those
who have trusted Sahara with their meagre earnings.
Where is the money?
OK, there's some breaking news that is coming in now.
Parole has been granted to Saharashri Subrata Roy.
[indistinct shouting]
[whistling]
[Punam in Hindi] Whenever I go to Malvan, the people first come and ask me,
"Sister, when will we get our money? When will we get our money?"
Each time, I have to tell them, "The case is not over.
Until the case is over, I can't say anything."
I feel very ashamed
that I have to give them an answer which seems to have no end.
[bell chiming]
[bell continues chiming]
[Kondu] Why did this happen?
This should not have happened.
[inaudible]
But we don't have any enmity towards him.
Sometimes, these things happen in families.
[in English] There is still a class of people
who continue to believe
that, yes, he's a man who can do no wrong.
He is a man with charisma,
he has-- that man has divinity in him,
he has the business consciousness.
He is the bestest teacher,
human psychologist I have ever seen in my life.
[Bajaj] I have seen people swear by Sahara.
I have seen people in Madhya Pradesh,
in Chhattisgarh,
in the Naxalite-infested jungles of Gadchiroli,
they had more faith in Sahara than they had in Indian banks,
than in the banking institutions of government.
[Thakurta] Somewhere along the line,
I think he bit off much more than what he could chew.
Hubris caught up with him
and today he's a pale shadow of what he was.
[motorbike engine puttering]
[Jamvwal] Saharashri's story...
is a story of a visionary who was able to pull it off.
But when he reached there,
he could have...
been more cognizant of the law.
They were people who trusted him.
They were people who believed in him.
You can't let them down.
And I think that's a great lesson there
for everyone trying to make it big in India -
that you do it...
with a sense of integrity.
[theme music playing]