The Economic Offences Wing (EOW) of the Odisha police has arrested two persons from West Bengal for their reported involvement in a ponzi scheme, while the money duped by them could cross ₹1,000 crore.
About 800 investors from Odisha’s Ganjam district filed a complaint that they invested money in 18football.com, a ponzi scheme (multilevel marketing) run online, giving a name of football betting or gaming application, and were cheated.
The two accused were identified as Rustam Khan and Md. Hakim, directors of a ‘shell’ company — Hakim and Rustam Fabrics Private Limited, Kolkata.
“Investors were promised of giving lucrative benefits like 3% daily compound return on investment, recharge bonus, referral bonus, extra bonus on the earning of the down line members and salary bonus with daily withdrawal option,” said Jai Narayan Pankaj, Inspector General of Police and head of the EOW.
As per the modus operandi revealed by the EOW, investors were required to create an account with ‘18football.com’ either by application or through offline referral link, and were being asked to bet money in some football matches as prescribed in the website or app.
Investors were also provided with the so-called foreigner ‘mentor’ to assist them in betting while mentors used to communicate through telegram or Apps only, the investigating agency said.
“In order to promote and to allure the innocent public, the fraudsters were taking up promotional activities like some social works and charity in rural areas and giving it huge publicity so that people will consider this scheme as a bona fide organisation,” the agency said.
The fraudsters, according to the EOW, initially paid the promised return for few days to the investors, yet in the latter stage when the membership increased, they stopped making any payment and closed the app ‘18football.com’.
Investigation found that the scamsters had used multiple shell companies or firms and their directors to route the ill-gotten money.
“They also used mule accounts for multilayering of money transaction to confuse the law enforcement agencies. One of the companies was Kolkata-based Hakim and Rustam Fabrics Private Limited of which the two arrested fraudsters were the directors. They had confessed to get small amount of commission to run this shell company,” said Mr. Pankaj.
The accused confessed that they used to get the order from one Md. Sheikh Saifi from Dubai. Out of 150 bank accounts involved in this racket, the EOW has analysed 17 accounts till date. Transactions of ₹108 crores have already been traced. It is suspected that money involved in this scam could go beyond ₹1,000 crore.
The investigators suspected it to be a huge international scam as the website was registered in Hong Kong, but operated from Dubai. The EOW would involve other law enforcement agencies of the Centre and other State governments to unearth the scam.