The Enforcement Directorate (ED) has attached movable and 376 immovable properties worth more than Rs 268 crore linked to an Andhra Pradesh-based firm in a ponzi scam case.
The attached properties belong to Akshaya Gold Farms and Villas India Limited, its other sister concerns, its directors, relatives of directors, and their benamidars.
ED had initiated the money laundering investigation on the basis of an FIR registered in 2012 by Andhra Pradesh Police under sections of Prize Chits and Money Circulation Scheme Act and section 420 (cheating) of the Indian Penal Code against the firm, its directors – Bhogi Subramanyam, Devaki Harnath Babu, M Sudhakara Rao and others for allegedly defrauding lakhs of people through their money circulation pyramid scheme.
As many as 29 FIRs were filed by the Andhra Pradesh Police. The Central Bureau of Investigation also filed an FIR in Odisha against the Akshaya Gold group.
ED has alleged that the firm deliberately cheated the public by collecting deposits without any legal permission from the Reserve Bank of India (RBI) and other concerned authorities. The accused, according to officials, collected investments from lakhs of investors who were encouraged to join the business by organised agents, who were given a handsome commission to enroll new clients.
“A hierarchy of agents was created in a pyramidal manner to earn high commissions. Investors were lured into investing their life savings by promising sites in advertised real estate ventures and offering high rate of return in various deposit schemes (weekly, monthly and lump sum). In order to earn a commission, agents did promotional programmes and encouraged investors with a promise of handsome return on maturity or owning a plot of an equivalent amount,” said the ED.
According to officials, a fund trial probe revealed that the money collected from the public was diverted and utilised for investment into group companies of promoters and other companies owned by family members and for purchase of personal properties by directors in their personal, benami, family member’s names, and also illegally withdrawn by directors in form of commission.
The ED has alleged that the company never had enough land, but still kept on collecting deposits from new members. The investments received from new members were allegedly used to pay commissions to the agents and the scheme was unsustainable and bound to collapse.
The accused collected deposits from 19.17 lakh investors spread across 10 states and collected a total of Rs 857 crore via their illegal schemes.
Out of the collected amount, the company allegedly has failed to return nearly Rs 384 crore to customers, which is total proceeds of crime in this case.