3 employees of 2 microfinance institutions, SKS and Spandana, were arrested by the Yemmiganur police, Kurnool district, late on Thursday night on charges of harassing a defaulter to recover loans.
According to police, the arrests followed complaints registered under the
ordinance which had been promulgated by the State government last week.
The complaints were filed by of one Ammalu who had taken Rs. 70,000 from the 2 MFIs as loan and had defaulted.
The complainant stated that the collection agents of the 2 companies had harassed her since the past 2 months for repayment.
Following the complaint, the police arrested Venkateshwarulu and Ramesh, both employees of SKS, and Pullaiah of Spandana microfinance institution under Section 16 of the AP Microfinance Institutions (Regulation of Money Lending) Ordinance-2010. Police also registered cases under Sections 341, 506 IPC against the 3 MFI employees.
The police did not rule out the arrest of the company promoters, who could also be booked under the new Ordinance. The police stated that the arrested employees claimed that they had sought repayment from Ammalu under orders from the company promoters.
The arrests were the first under the ordinance which was given the nod by Governor ESL Narasimhan last week.
The accused can face imprisonment up to 3 years and can also be fined up to Rs. 1 lakh for their arm-twisting methods in trying to recover the loans.
Earlier, Director General Of Police, K Arvinda Rao, had ordered that the police should show no leniency in booking cases against erring MFIs.
Courtesy: INN