CBI Arrests Two Key Accused in ₹800 Crore Uttarakhand LUCC Chit Fund Scam; Over One Lakh Investors Affected

Dehradun / Mumbai, June 2, 2026: The Central Bureau of Investigation (CBI) has arrested two key accused in the alleged ₹800 crore chit fund scam involving the Loni Urban Multi State Credit and Thrift Co-operative Society (LUCC), in a major development in the ongoing investigation. The arrests were made in Mumbai, Maharashtra, on June 1, following an extensive investigation into the alleged collection and diversion of money deposited by investors across Uttarakhand.

According to the CBI, more than one lakh investors are estimated to have deposited approximately ₹800 crore in various unregulated deposit schemes operated by LUCC. The agency is investigating allegations that funds collected from the public were improperly handled, diverted and misappropriated as part of a larger conspiracy involving several individuals associated with the society.

The latest arrests are part of the agency’s efforts to identify those responsible, trace the movement of the collected money and determine whether assets acquired using the alleged proceeds can be recovered for the benefit of affected depositors.

Two Key Accused Arrested After Multi-State 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 significant roles in collecting, managing, diverting and allegedly misappropriating money received from investors through LUCC’s deposit schemes.

The arrests followed sustained investigative efforts involving the examination of extensive financial records, scrutiny of bank transactions, collection of witness statements and field inquiries conducted across different states.

Investigators have been examining the financial trail to establish how the money was collected, where it was transferred and how it was ultimately utilised. The agency is also looking into the alleged involvement of other individuals who may have participated in the suspected financial arrangement.

Following their arrests, the CBI obtained transit remand to bring the accused before the appropriate court in Dehradun under the applicable legal provisions, including those relating to the alleged operation of unregulated deposit schemes.

The agency expects further investigation to help establish the individual roles of the accused and clarify the wider network through which the funds were allegedly handled.

How the Alleged ₹800 Crore Scam Came Under CBI Investigation

The CBI took over the investigation following an order issued by the Uttarakhand High Court at Nainital on September 17, 2025, in connection with multiple petitions, including WPCRL No. 1020/2025.

In compliance with the court’s directions, the CBI’s Anti-Corruption Branch in Dehradun registered a case on November 26, 2025, taking over the investigation of 18 FIRs previously registered by Uttarakhand Police.

The case names various office-bearers of LUCC and other individuals in connection with allegations of cheating, criminal breach of trust, criminal conspiracy, illegal collection of public deposits, operation of unregulated deposit schemes and suspected misappropriation of funds.

The investigation is being conducted under the applicable 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).

By bringing the cases together, investigators are seeking to establish the extent of the alleged wrongdoing and understand how the activities affected depositors in several districts of Uttarakhand.

More Than One Lakh Investors Reportedly Deposited Their Savings

The scale of the alleged fraud has emerged as one of the most concerning aspects of the case. According to the CBI’s investigation, more than one lakh investors are estimated to have deposited a combined amount of approximately ₹800 crore in various LUCC schemes.

For many investors, money placed in deposit schemes represents years of savings, intended to support their families, meet education and healthcare expenses, or provide financial security for the future. Allegations of large-scale financial irregularities can therefore have serious consequences for households that depend on these savings.

The CBI is examining the records relating to the deposits and the transactions through which the money was allegedly transferred or diverted. Investigators are also trying to establish whether the funds were used for their stated purposes and identify the individuals responsible for decisions concerning their handling.

The exact extent of the losses suffered by individual investors and the amount that may ultimately be recoverable will depend on the findings of the investigation and subsequent legal proceedings.

Five Accused Were Arrested Earlier in May

The latest arrests follow an earlier operation by the CBI on May 12 and 13, 2026, when the agency arrested five accused persons in connection with the same case.

Those arrested included three senior cooperative promoters associated with LUCC in Uttarakhand. According to the agency, they were allegedly involved in collecting deposits from members of the public and managing the society’s chest branches.

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

With two additional arrests, the investigation has expanded its focus on the alleged network involved in mobilising and handling public deposits. The CBI is continuing to examine the connections between the accused and determine whether other people were involved in the alleged conspiracy.

Properties Linked to Alleged Proceeds May Be Examined for Recovery

Apart from making arrests, the CBI has obtained details of several immovable properties allegedly acquired by the accused using proceeds of crime.

The agency has shared the property details with the competent authority under the BUDS Act, identified as the Secretary of the Finance Department, Government of Uttarakhand. It has requested that the properties be frozen and that necessary legal action be taken to facilitate their distribution to eligible victims in accordance with the law.

The move is intended to help preserve assets that may be connected to the alleged financial wrongdoing and explore possible avenues for compensating affected investors.

However, the identification of properties does not automatically mean that investors will receive refunds. Any freezing, attachment or distribution of assets must follow the applicable legal procedures, and actual recovery will depend on the assets available and decisions made by the competent authorities.

For depositors awaiting the return of their money, tracing and securing assets could become an important part of the broader recovery process.

CBI Continues Investigation Into the Alleged Financial Conspiracy

The CBI has described the latest arrests as a significant milestone in its efforts to uncover the alleged larger conspiracy behind the collection and diversion of public deposits through LUCC’s schemes.

The investigation remains ongoing. The agency is working to trace the flow of funds, establish the roles of the accused, identify other individuals who may have been involved and examine properties potentially linked to the alleged proceeds of crime.

The CBI has stated that it aims to complete the investigation at an early date. Further action will depend on the evidence gathered and the findings of the inquiry.

The case has drawn attention to the risks associated with unregulated deposit schemes and the importance of safeguards designed to protect people’s savings. For the investors concerned, the key questions remain what happened to their money, who was responsible for the alleged irregularities and whether funds or assets can be recovered through the legal process.

The allegations against the accused have yet to be conclusively established, and the case will proceed in accordance with the law.

News source: Information for this article was gathered from a variety of reliable news outlets.