MUMBAI: An Indian regulator has frozen the bank accounts of two companies of the giant Sahara group after it failed to obey a court order to repay billions of dollars illegally collected from investors.

Sahara, a household name in India and sponsor of the national cricket team, raised 240 billion rupees ($4.4 billion) in illegal bond sales to 30 million small investors between 2008 and 2011.

The Supreme Court said in August Sahara had “no right to collect” the funds from millions of investors without complying with regulatory provisions and ordered it to repay $3 billion with 15 per cent interest by the end of November.

However, the firm has still not paid up most of the cash ordered by the court, despite being given extra time to find the money in December.

The Securities and Exchange Board of India (Sebi) said on its website late Wednesday it had ordered the freezing of bank accounts of tycoon Subrata Roy, Sahara's chief, and three other directors.

The assets of two Sahara group firms, Sahara India Real Estate Corp. and Sahara Housing Investment Corp, were also to be seized.

But Sahara, which has millions of mainly poor, rural savers, said in a statement that “the total liability was unlikely to exceed 51 million rupees, which it has already paid”.

Three-decade-old Sahara, based in Uttar Pradesh state capital Lucknow, said the latest Sebi order was based on “old facts and details of assets”.

Sahara Housing shares slid 12.2 percent to 47.75 rupees following the news.

The central bank has said that Sahara instead of protecting poor clients, cut interest payments to as low as one percent, failed to ensure full deposit protection and had not kept a proper customer database.

Roy, who heads the Sahara empire, in November bought the New York Plaza Hotel, while he also owns London's Grosvenor House hotel, a stake in a Formula 1 racing team and a sprawling Indian luxury township.