The Hyderabad Police on Wednesday arrested 10 persons, including a Chinese and a Taiwanese citizen, in connection with an alleged online investment fraud of Rs 903 crore.
The police alleged that the operation involved using money exchange and forex firms to convert funds gathered illegally through online investment mobile apps to United States dollars. This converted money was then sent abroad through hawala operations.
“We suspect there would be lakhs of investors across the country who may have been defrauded,” Hyderabad Police Commissioner CV Anand told NDTV. “Just in Delhi, Rs 10,000 crore fraud may have happened... The amount could run into thousands of crores. What we have found is evidence of Rs 903 crore moved out illegally.”
The arrests were made on the basis of a complaint filed by a Hyderabad resident, who had alleged that he was cheated after having invested Rs 1.6 lakh in an investment app called LOXAM.
“On investigation, it is found that the money of the complainant was deposited in the bank account of IndusInd Bank in the name of Xindai Technologies Pvt Ltd,” Anand said in a statement.
This bank account was opened by Virender Singh, who was arrested from Pune. Singh told the police that he had opened the account on the orders of a Chinese citizen identified as Jack.
Further investigation showed that that the bank account of Xindai Technologies was linked with another company named Betench Networks, Anand said. This account, along with 15 similar ones, was opened by a Delhi resident named Sanjay Kumar, who received Rs 1.2 lakh commission for each account after he shared their details with arrested Taiwanese citizen Chu Chun-yu, according to the police.
The money from Xindai Technologies was then allegedly transferred to 38 different bank accounts. It finally landed with authorised money exchange firms Ranjan Money Corp and KDS Forex Private Limited, Anand said.
After the money was exchanged to dollars, it was sent abroad through hawala transactions.
“The money changers and Forex Exchanges are licensed by RBI,” the police chief said. “However, they have repeatedly flouted the guidelines laid down by RBI regarding money changing activities.”
He added that Rs 1.91 crore have so far been frozen in various bank accounts in connection with the case.
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