ED seizes assets worth Rs 427 crore in Karnataka Ponzi scam

The Enforcement Directorate ED Mangaluru in Karnataka has provisionally attached movable and immovable properties worth Rs 42716 crore belonging to Shivanand Siddappa Neelannavar and his associates in connection with an alleged largescale Ponzi investment scam involving the collection of Rs 245949 crore from more than 35000 investors primarily in Karnatakas Belagavi regionThe action was taken under the Prevention of Money Laundering Act PMLA 2002 The attached assets include bank balances fixed deposits shares bungalows agricultural land residential properties and other real estate investmentsAccording to an ED press release issued on Saturday the accused allegedly operated an investment fraud scheme through Shivam Associates and other associated entities promising investors exceptionally high returns of 3 per cent per month and an additional 05 per cent referral commission for bringing in new investorsThe scheme reportedly relied on a network of referral agents referred to as leaders who were encouraged to mobilise more investors by promising assured and attractive returns The ED estimates that approximately Rs 245949 crore was collected from over 35000 investors through the alleged schemeThe investigation has revealed that the funds collected from investors were allegedly diverted and layered through several channels to conceal their origin and utilisationA substantial portion of the money was reportedly invested in highrisk stock market trading resulting in net losses of Rs 18595 crore The investigation also found that approximately Rs 25 crore was routed through Shreemata Cooperative Credit Society Ltd and Dhanashree Multipurpose Cooperative Society LtdThe ED further alleges that investor funds were used to purchase agricultural land residential properties plots and other real estate assets Money was also allegedly transferred to bank accounts belonging to family members including the accuseds wife and minor sonThe investigation has also traced funds to associated business entities including Shivam Sevaa OPC Pvt Ltd Shivam Lifeline Pvt Ltd and Shivam Foods Around Rs 19 crore was allegedly channelled into Shivam Sevaa OPC Pvt LtdAs part of the investigation the ED conducted searches and seized documents handwritten records mobile devices and other digital evidence The agency had also earlier frozen bank accounts and fixed deposits containing approximately Rs 202 crore allegedly generated from investor fundsThe latest provisional attachment covers assets worth Rs 4271637165 These include fixed deposits held across various banks and cooperative societies balances in 47 individual and corporate bank accounts 42 properties comprising agricultural land family bungalows and bookings for apartments in developer projects besides stock market investments held through CDSL demat accountsThe attached assets are worth approximately 174 per cent of the total alleged collections of Rs 245949 crore indicating the scale of the financial trail that investigators are attempting to traceThe EDs investigation is continuing with the agency examining the alleged diversion of funds through family members associates cooperative societies and connected business entitiesThe provisional attachment is aimed at preventing the identified properties from being transferred or disposed of during the legal proceedings The attachment will be subject to adjudication under the PMLA and further investigation may lead to the identification of additional assets and beneficiariesThis story has been sourced from a third party syndicated feed agencies Midday accepts no responsibility or liability for its dependability trustworthiness reliability and data of the text Midday managementmiddaycom reserves the sole right to alter delete or remove without notice the content in its absolute discretion for any reason whatsoever