Rs 2,000 crore chit fund case: ED searches WBEPL premises in Visakhapatnam, Hyderabad

Bhubaneswar, Aug 10 (IANS) The Enforcement Directorate’s (ED) Bhubaneswar Zonal Office has carried out search operations at five locations linked to M/s. Wellfare Buildings and Estates Pvt Ltd (WBEPL) and its Directors in Visakhapatnam and Hyderabad in connection with an investigation in a multi-crore chit fund scam, informed the ED in a press statement on Monday.

The central agency also added that the search operations were conducted under Section 17 of the Prevention of Money Laundering Act (PMLA), 2002, on August 5 at the residential buildings and business premises of the WBEPL and its Directors, namely Malla Vijaya Prasad, Varaha Ramakrishna Satya Sinivasa Rao Alla and others. The ED officials further noted that during the search, the sleuths recovered Rs 1.01 crore in cash.

The sleuths also seized electronic devices, computers, mobile phones, and details of various movable and immovable properties, incriminating materials and documents related to M/s. WBEPL, its directors and related entities. To ensure that the accused company and its directors cannot move or use the funds, the agency froze 182 bank accounts.

Additionally, they seized six expensive luxury cars owned by the company and its bosses. The ED initiated an investigation in the case based on multiple FIRs and subsequent Chargesheets filed by the Economic Offences Wing (EOW), Bhubaneswar, CBI, ACB, Dhanbad; Odisha Police and a complaint by Serious Fraud Investigation Office against M/s. WBEPL and its Directors.

The agency noted that its investigation revealed that the directors and managing director of WBEPL operated a large-scale deposit mobilisation scheme disguised as a real estate business and collected public funds amounting to more than Rs 2,000 crore in violation of statutory provisions. The company allegedly used fresh collections to repay earlier investors, diverted investor funds for unrelated purposes and personal gains, manipulated its financial statements to conceal deposits, and engaged in irregular land transactions to suppress the actual consideration and evade statutory obligations.

“Investigation conducted by ED so far revealed that the above-said funds were collected unauthorizedly from thousands of gullible investors belonging to multiple states including Odisha, West Bengal, Bihar, Jharkhand and Andhra Pradesh and others through different schemes under the false pretext of providing land in Visakhapatnam, the company had closed its operation from the branch offices located across multiple states of India and thereby cheated the investors,” ED said.

–IANS

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