TAP TO UNMUTE

The Enforcement Directorate (ED) has registered a case of money laundering under the PMLA Act against a group of persons, for running an illegal online scam where more than 6.5 lakh investors were duped of ₹3,700 crore.

As per a statement by the agency, the case was registered by the ED on the basis of a FIR lodged by the Special Task Force (STF) of the UP Police against a multi-level marketing/ Ponzi Scheme based out of Noida.

The scam was first unearthed on February 3 when a 26-year-old engineering graduate Abhinav Mittal was arrested along with two other members - Shridhar Prasad and Malesh Dayal - who were the main involved in running the first such online ponzi scheme in India.

As part of the investigation, the ED officials on Sunday conducted raids at five premises belonging to the offenders, located across Kanpur, Ghaziabad and Noida.

While the country is no stranger to Ponzi schemes, this is the first instance where a ponzi scheme has been circulated via social media. While the money involved is comparatively less that larger scams such as Saradha and Rose Valley chit fund scam, it is an indication that the online space can also be used for running ponzi schemes.

The modus operandi in this particular episode was interesting: The company, run by the three accused, promoted a scheme wherein they would ask interested members to deposit a certain amount of money and then asked them to promote/ like some website links (fake) on various social media platforms

In the statement, ED said the accused persons propagated a false story that the promotional web pages linked on these international social media portals pay ₹6 per likes out of which they pay ₹5 to the investment/ user.

"The accused also promoted FOUR systematic investment plans offering various incentives depending upon the investment made by the user. The Multilevel Marketing and Ponzi Schemes where run by M/s Ablaze Info Solutions Private Ltd, M/s Social Trade India Pvt Ltd, M/s 3W Digital Pvt Ltd, M/s Intmaart India Pvt Ltd. All these companies are brain child of one Mr Anubhav Mittal, Ms Ayushi Agarwal and others," added the statement.

As soon as the main accused was arrested, searches conducted led to the recovery of several incriminating documents, revealing the offence of money laundering and possession of huge sum of money.

"The documents recovered are likely to be useful in recovery of cheated funds as well as properties acquired out of proceeds of crime beyond the frozen amount of Rs 500.00 crore balance in the accounts of the company," ED said.

The Directorate has also asked for details of transaction from the related Banks which were used by the accused persons. The Directorate will seek custodial investigation of the accused arrested by the (STF) and there accomplices.

While several people have accused Mittal's company of conning them, a number of investors also came to his aid, pointing out that they made good profits after investing for the scheme.

When the online scam came to light, several investors in the company from various places in the country gathered outside Mittal's office - M/s Ablaze Info Solutions Private Ltd - and protested saying that they made good amount of profit on their investment and the 26-year-old was being framed for providing such a 'productive' scheme.

While this is the first time such an online scheme has been unfolded, people should b careful while signing up for such deals. The online space is filled with conmen and duping people to paying money without hacking is the easiest way for them to earn money.