Director of Chit fund firm arrested in Rs 10 crore cheating case

Bhubaneswar: The The Economic Offenses Wing (EOW) of the Odisha Crime Branch has arrested the director of a bond fund company for his alleged involvement in defrauding investors of more than 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 Gwalior Agency on February 13 under sections 406, 420, 467, 468, 471, 120 B of the IPC, article 66 of the computer law, articles 4, 5, 6 of the PCMCS law (prohibition) and article 6 of the OPID law.

Upon his arrest, he was brought before JMFC, Dabara, Gwalior and is brought to Bhubaneswar under remand.

The case was filed following an investigation by the EOW into 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 having deceived and deceived up to 500 gullible depositors to the tune of more than Rs 10 crore under the false promise of high returns on their deposits/investments into different schemes initiated by the company .

Investigation into the matter revealed that M/s Auroxa Deal Multitrade (OPC) Pvt. ltd. was registered with the ROC, Gwalior in May 2019 and accused Babu Singh Kushwaha of being the sole administrator. The said company under various lucrative programs/packages has been promoting direct selling of various household items/electronics with high returns with money back offers.

Law enforcement sources said that the deposits collected by the company under the guise 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 like a binary scheme in which early entrants earn money and as the number of investors/depositors increases, the scheme collapses at a point of time. Thus, deception and fraud are camouflaged as direct sales and corporate marketing.

It was established during the investigation that during the year 2019-2020, the office of M/s Auroxa Deal Multitrade (OPC) Private Limited operated in a rented building near Suraj Hotel, Sahadevkhunta, Balasora. Defendant Babu Singh Kushwaha and other promoters of the business have been motivating newcomers/investors to join various business packages and collected huge deposits from the public.

Further investigation into the matter was underway by the EOW.