News Agency wire first broke the story of financial mismanagement of AGIF funds
Investment Guru claimed in March 2019,
The news was further covered in Business Standards
Please note that Army Group Insurance Fund is a private fund, which has been created by Army by taking subscription from soldiers and officers; serving and retired both, to provide them war insurance cover at a very heavy premium. The website of AGIF is not existing now. As per the financial laws and regulations, the annual report of AGIF along with its audited balance sheet shall be available in public domain and shall be shared to its members for their information. The same is not available. For every army soldier and officer subscription to AGIF is mandatory however in violation to existing fund management laws, they have no say in management of funds. The management committee is appointed by Army HQs and investment decisions are made in secrecy. It is said that AGIF hold huge funds but how much is that fund, is not even known to their subscribers.
It may also be noted that in India, govt does not take responsibility to pay premium of insurance of war risks of soldiers as is the norm in most countries.
IL&FS is an IAS managed company, which was in news for suffering heavy losses due to financial mismanagement. AGIF investing Rs 200 crores plus in a company already suffering heavy losses violates financial investment principles. Army has a detailed SOP for management of fund. It appears that such SOP has been violated while investing funds in IL&FS Bonds traded in market.
There is certainly a need to manage AIGF as per govt policy and laws with transparency. Its members who are key stake holders, shall have say in formation of its board of directors and appointment of various management committee. The annual audited reports must be published. It is hard earned money of soldiers and officers and shall not be mismanaged that too in secrecy.
Veterans on social media are demanding proper investigation in reported financial mismanagement to fix the reasonability. Fund Regulators must take immediate note and govt must order an investigation.
AGIF invested in Stock Market under the stewardship of the present COAS BiRa.
Investment was done through IL&FS(Infrastructure Leasing & Financial Services), a company whose “Financial Services” section deals in stock market. AGIF suffered a loss of more than 2K Crores.
— Military Justice (@miljustice_in) April 26, 2019