Odisha: Chit Fund Company Director Arrested In Rs 10 Crore Cheating Case
Bhubaneswar: The Economic Offences Wing (EOW) of the Odisha Crime Branch arrested the director of a chit fund company over his alleged involvement in duping investors of over Rs 10 crore.
The accused, identified as Babu Singh Kushwaha, Director and Promoter of M/s Auroxa Deal Multitrade (OPC) Pvt. Ltd., was apprehended by the agency from Gwalior on February 13 under Sections 406, 420, 467, 468, 471, 120 B of the IPC, Section 66 of the IT Act, Sections 4, 5, 6 of the PCMCS (Banning) Act, and Section 6 of the OPID Act.
On being arrested, he was produced before the JMFC, Dabara, Gwalior and is being brought to Bhubaneswar on the strength of transit remand.
The case has been registered pursuant to an enquiry conducted by the EOW on a petition filed by Chandra Kanta Dash and others against M/s Auroxa Deal Multitrade (OPC) Pvt. Ltd. and its director and promoters on the allegation of cheating and duping as many as 500 gullible depositors to the tune of more than Rs 10 crore under the false promise of high returns on their deposits/ investments in different schemes launched by the company.
Investigation of the case revealed that M/s Auroxa Deal Multitrade (OPC) Pvt. Ltd. was registered with ROC, Gwalior during May 2019 and accused Babu Singh Kushwaha is its only director. The said company under various lucrative schemes/ packages promoted direct selling of various household goods/ electronic goods with high returns having cashback offers.
Police sources said that the deposits collected by the company under the cover of direct selling are nothing but Ponzi Schemes and Binary Schemes. The business model of M/s Auroxa Deal Multitrade (OPC) Private Limited is a simple pyramid structure, works as a binary scheme in which the early entrants earn money and as the number of investors/ depositors increases, the scheme collapses at a point of time. Thus, the deceit and fraud is camouflaged under the name of direct selling marketing and business.
It has been ascertained during investigation that during the year 2019-2020, the office of M/s Auroxa Deal Multitrade (OPC) Private Limited was functioning in a rented building near Suraj Hotel, Sahadevkhunta, Balasore. Accused Babu Singh Kushwaha and other promoters of the company motivated the newcomers/ investors to join various business packages and collected huge deposits from the public.
Further investigation into the matter was underway by the EOW.