Bhubaneswar, Sep 26 (IANS): A court here Friday granted bail to Ashok Mohanty, former advocate general of Odisha, who was arrested Sep 22 by the CBI for his alleged involvement in the chit-fund scam.

The Khurda district and session court granted him bail against a bond of Rs.1 lakh with two sureties of like amount, a lawyer told IANS.

The court, however, directed Mohanty to cooperate with the Central Bureau of Investigation (CBI) in the investigation, he said.

The Central Bureau of Investigation is probing the chit-fund scam on the direction of the Supreme Court. The scam came to light after a large number of investors last year complained that many firms collected huge amounts of money from them promising high returns, but later refused to pay them back their monies.

The CBI is probing at least 44 companies in Odisha, including the Kolkata-based Saradha Group and the Odisha-based Seashore and Artha Tatwa groups. The loss to investors from the scam is said to be running into thousands of crore of rupees.

Mohanty, who was arrested for his alleged link with Artha Tatwa Group, was earlier interrogated by the CBI Sep 13, a day after he resigned from the advocate general's post.

Mohanty was accused of buying a house from Artha Tatwa Group chief Pradip Sethy through "questionable means".