CBI Arrests Two Alleged Masterminds in ₹800 Crore Uttarakhand LUCC Chit Fund Scam Affecting Over One Lakh Investors

Dehradun / Mumbai, June 2, 2026: The Central Bureau of Investigation (CBI) has arrested two key accused in the alleged ₹800 crore LUCC chit fund scam in Uttarakhand, marking a significant development in an investigation into one of the major suspected deposit fraud cases affecting investors across the state. The two accused were arrested in Mumbai, Maharashtra, on June 1, 2026, following an extensive investigation involving financial records, banking transactions, witness statements and field inquiries across multiple states.

The case concerns allegations that the Loni Urban Multi State Credit and Thrift Co-operative Society (LUCC) collected money from members of the public through various unregulated deposit schemes. According to the CBI, more than one lakh investors are estimated to have invested a combined amount of approximately ₹800 crore in these schemes.

The investigation is focused on establishing how the money was collected, handled and allegedly diverted, as well as identifying the individuals responsible for the suspected financial irregularities.

Two Key Accused Arrested After Extensive Investigation

According to the CBI, the two individuals arrested on June 1 are among the primary accused in the case. Investigators allege that they played an active and significant role in the collection, handling, diversion and suspected misappropriation of funds deposited by investors under various schemes operated by LUCC.

The agency said the arrests followed sustained investigative efforts, including the analysis of extensive financial records, examination of bank transactions, collection of oral evidence and field investigations conducted across different states.

Investigators are examining the alleged roles of the two accused in the wider network responsible for mobilising deposits from the public. Evidence collected so far reportedly indicates their involvement in the alleged conspiracy concerning the routing, management and utilisation of funds collected from a large number of investors.

Following their arrests, the accused were to be produced before the appropriate court in Dehradun after the CBI obtained transit remand. The proceedings are being pursued under the applicable legal provisions, including those relating to the alleged operation of unregulated deposit schemes.

The arrests are expected to assist investigators in examining the movement of money, identifying other individuals who may have been involved and tracing assets that could be linked to the alleged proceeds of crime.

How the LUCC Case Reached the CBI

The CBI’s investigation began after an order dated September 17, 2025, was passed by the High Court of Uttarakhand at Nainital in connection with multiple petitions, including WPCRL No. 1020/2025.

Acting in compliance with the court’s directions, the CBI’s Anti-Corruption Branch in Dehradun registered a case on November 26, 2025. The agency took over the investigation of 18 FIRs that had previously been registered by Uttarakhand Police.

The case was registered against various office-bearers of LUCC and other individuals under provisions of the Indian Penal Code (IPC), the Bharatiya Nyaya Sanhita (BNS), the Uttarakhand Protection of Interests of Depositors Act (UPID Act) and the Banning of Unregulated Deposit Schemes Act (BUDS Act), as applicable to the case.

The allegations include the illegal collection of public deposits, cheating, criminal breach of trust, criminal conspiracy, the operation of unregulated deposit schemes and the alleged misappropriation of funds.

The CBI is now examining the cases collectively to establish the extent of the alleged financial wrongdoing and determine how the activities affected depositors across multiple districts of Uttarakhand.

More Than One Lakh Investors May Have Been Affected

One of the most significant aspects of the investigation is the reported scale of the alleged fraud. According to the CBI, more than one lakh investors are estimated to have placed deposits totalling approximately ₹800 crore in various LUCC schemes.

For many households, savings placed in deposit schemes represent years of hard work and financial planning. The alleged loss or diversion of such funds can cause serious financial difficulties, particularly for people who depend on their savings to meet everyday expenses, education costs, healthcare needs and other essential requirements.

Investigators are therefore focusing on the complete trail of money collected from depositors. This includes determining how deposits were received, which accounts were used to handle the funds, where the money was transferred and whether the funds were diverted for purposes other than those represented to investors.

The agency is also examining the alleged roles of different office-bearers and other individuals associated with the society. These inquiries are intended to establish individual responsibility and identify any additional persons who may have participated in the suspected scheme.

The final extent of the financial losses and the circumstances surrounding individual investments will depend on the evidence gathered during the investigation.

Five Accused Were Arrested Earlier in May

The latest arrests follow an earlier round of action by the CBI. On May 12 and 13, 2026, the agency arrested five accused persons, including three senior cooperative promoters associated with LUCC in Uttarakhand.

According to the CBI, these individuals were allegedly involved in collecting deposits from members of the public and managing the society’s chest branches.

All five were reported to be in judicial custody at Sudhowala Jail in Dehradun at the time of the June 2 press release.

With the arrest of two additional accused, the CBI is continuing to investigate the alleged network behind the collection and movement of public deposits. The agency is examining whether the accused acted together with other individuals and how the suspected arrangement operated across different locations.

Properties Linked to the Alleged Proceeds of Crime Under Scrutiny

Alongside the arrests and financial investigation, the CBI has also obtained information about several immovable properties allegedly acquired by the accused using proceeds of crime.

The agency has shared the details of these properties with the competent authority under the BUDS Act, identified in the press release as the Secretary, Finance Department, Government of Uttarakhand. The CBI has requested that the properties be frozen and that necessary action be taken to facilitate their distribution to affected depositors in accordance with the law.

This step could be important in efforts to protect assets potentially connected to the alleged fraud and explore lawful avenues for providing relief to investors.

However, the identification of properties does not automatically guarantee repayment. Any freezing, attachment, sale or distribution of assets must follow the applicable legal procedures, and the amount ultimately recoverable will depend on the assets available and the decisions of the competent authorities.

The recovery process is particularly important in cases involving large numbers of depositors, as tracing and securing assets may help preserve resources that could potentially be used to compensate eligible victims.

CBI Continues Probe Into the Wider Conspiracy

The CBI has described the latest arrests as an important milestone in uncovering the alleged larger conspiracy behind the collection and diversion of public deposits through LUCC’s unregulated schemes.

The investigation remains ongoing, with the agency working to establish the full extent of the alleged wrongdoing, trace the movement of funds, identify other individuals involved and examine assets that may have been acquired using the suspected proceeds.

The agency has also stated its intention to complete the investigation at an early date. Further action will depend on the evidence collected and the findings of the ongoing inquiry.

For the investors affected by the case, the investigation is an important step towards understanding what happened to their money and whether assets can be recovered through the legal process. At the same time, the allegations against the accused remain subject to the judicial process, and guilt must be established in accordance with the law.

News Source: Central Bureau of Investigation (CBI) – Official Press Release, dated June 2, 2026.