A plain guide to deposit-taking schemes, network marketing and the records that describe them.

A scheme can take money without calling it a deposit

The Banning of Unregulated Deposit Schemes Act does not rely on the word 'deposit' appearing in the paperwork. It defines a deposit by what the money does: it is taken from the public, it is repayable, and it is not covered by a listed exemption. A scheme that calls its collection a 'contribution', 'advance', 'membership fee' or 'investment' can still be caught if the substance matches the definition. The law looks through labels to the mechanics of the transaction.

This matters because many schemes draft documents that avoid the word 'deposit' altogether. They may issue receipts for 'purchase of products' or 'enrolment in a business plan'. If the money is pooled and a return is promised, the wording on the receipt does not decide legality. The designated authority will examine what was promised and how the funds were used, not the title given to the payment.

A reader who is assessing a scheme should therefore not be reassured by careful wording. The question is whether the scheme is allowed to take money from the public at all, not what it calls the money. If the entity is not on a list of regulated deposit takers, the label is irrelevant. The law is drafted to catch exactly this kind of relabelling.

The Sachet portal does not freeze assets or stop a scheme

Filing a complaint on the Sachet portal creates a record for the regulator to act on, but it does not by itself stop the scheme from operating. The portal is a channel for information to reach the right authority, whether that is the Reserve Bank, SEBI or a state police force. The authority may then investigate, issue directions, or refer the matter for prosecution, but each step takes time.

During that time, the scheme may continue to collect money from new participants. A complaint does not automatically freeze bank accounts or seal offices. Those actions require a separate order from a designated authority or a court. The portal is a starting point, not an emergency brake. Readers who have already transferred money should also consider approaching their bank and the local police in parallel.

This distinction is often missed. A complainant may file a detailed report and wait, expecting the scheme to be shut down. The portal's value is in aggregation: multiple complaints about the same entity help authorities see the scale and pattern. One complaint may not trigger immediate action, but it contributes to a file that can eventually lead to enforcement.

A company record can show a charge that changes what your money is backed by

A company master record from the Ministry of Corporate Affairs includes details of charges registered against the company's assets. A charge is a security interest given to a lender, such as a bank or a financial institution. If a company has given a charge over its property, machinery or receivables, those assets are encumbered. In a winding up or enforcement, the charge holder is paid before unsecured creditors.

A person who puts money into a scheme is usually an unsecured creditor. The scheme may present itself as having substantial assets, but if those assets are already charged to a lender, their real value to the investor is limited. The record shows the charge and the amount secured, though not the current outstanding balance. That is enough to ask a sharp question: what is actually left after the lenders are paid?

Checking for charges is a step most readers skip. They look at the date of incorporation and the authorised capital, but not at the encumbrances. A company with a clean record on charges is not necessarily safe, but a company with multiple charges has already promised its assets to someone else. The record is public for this reason: it lets a reader see what the company has pledged before deciding whether to hand over money.