In a significant development, the Cooperative Ombudsman Alok Agarwal has directed the Kerala’s Kozhikode based Southern Green Farming and Marketing Multi-State Cooperative Society to refund over Rs 3.67 crore to multiple investors who had deposited their hard-earned money in fixed and recurring deposit schemes with the society.
The investors had been waiting for several months for the maturity proceeds, with repeated requests for refund going unanswered. A group of complainants including Smt. Ali C Kakkanattu, Danny Vincent Joseph, Vijayan K, Smt. Meera Radhakrishnan, P.B. Selvarajan, Chirayil Cherian Antony, Smt. Aiswarya Antony, Smt. Anne Mary Antony, Smt. Pushpa, Guruvayoorappan J, Johnny CC, Sebastian Tony, Col. Sivakumaran Mannil (Retd.) and others had approached the Ombudsman alleging non-receipt of maturity amounts and interest despite making several written and electronic representations to the society.
In one such case, Smt. Ali C Kakkanattu invested Rs 9 lakh in various FDs, one of which matured on 28th November 2024, but the maturity proceeds were never paid. Several other complainants, including senior citizens and retired professionals, had invested substantial sums ranging from Rs 50,000 to as much as Rs 50 lakh.
Many also held long-tenure recurring deposits, and some investors had not received even the regular monthly interest payments.
The total amount involved in the complaints examined by the Ombudsman amounts to a staggering Rs 3.67 crore, highlighting the gravity of the issue. Several complainants even submitted the minutes of a meeting held on 25th March 2025, during which the society’s Chairman had assured investors that payments would be made in a time-bound manner, a commitment that was never fulfilled.
Despite repeated notices from the Ombudsman’s office on 23rd April, 23rd May, and 2nd June 2025, the society failed to respond. Reminders issued on 26th May and 30th June 2025 also went unanswered. Alarmingly, some notices were returned undelivered with remarks such as ‘door lock’ and ‘closed down, RTS’, and emails to the society bounced back, suggesting the society is unreachable and non-functional.
Taking strong note of the non-compliance and continued silence of the society, the Ombudsman observed that the respondent had ceased to function as per cooperative principles and that the matter warranted firm action under the Multi-State Cooperative Societies Act, 2002.
The Ombudsman, Alok Agarwal, has issued a formal direction to the society to repay the complainants’ deposit amounts along with up-to-date interest within 15 days of the issuance of the order. The society has also been directed to settle any fresh complaints received henceforth within 15 days and submit a compliance report to the Ombudsman’s office.
This case has raised serious questions about the functioning and credibility of certain multi-state cooperative societies, especially in light of growing complaints about delayed payments and financial mismanagement. It also underscores the need for stricter oversight and regulatory reforms in the cooperative banking and financial sector to safeguard investor interests.
It bears recalling that recently, the chairman and board members of Southern Green Farming and Marketing Multi-State Co-operative Society were booked for defrauding investors.