New Delhi, May 10 -- When Chain Roop Bhansali's elaborately assembled financial house of cards collapsed in 1996, it didn't just cost 300,000 investors their life savings, it exposed the dangerous fragility of India's regulatory system at a time when the country had started opening its economy to the world.

Bhansali, a man of soaring ambition, emerged from humble roots to orchestrate one of the most audacious financial frauds of the 1990s. Coming within four years of the Harshad Mehta scandal, it exposed the vulnerabilities of India's nascent non-banking financial sector.

Hailing from Sujangarh, Rajasthan, Bhansali was born into a modest jute-trading family. After early unremarkable years in his hometown, he relocated to Kolkata, where ...