ED arrests 3 promoters of Agri Gold Group of Companies in Ponzi scheme case

New Delhi, Dec 23 (UNI) Directorate of Enforcement (ED) on Wednesday said that it has arrested Avva Venkata Rama Rao, Avva Venkata Seshu Narayana Rao, Avva Hema Sundara Vara Prasad, the main accused in the PMLA investigation into the Rs 6380 Crore Agri Gold ponzi scam case.

The accused were produced before the Hyderabad PMLA Court which has granted 14 days of judicial custody to all the three accused.

Earlier, searches were conducted at the residences of Avva Venkata Rama Rao and other directors including the residences of auditors at Vijayawada and Hyderabad and various property related documents, cash amount of Rs 22 Lakh, digital devices and other documents were recovered and seized.

The probe agency also revealed that the accused also set up companies abroad and diverted large amounts of funds to off-shore entities. Their names also figured in the Paradise Leaks and they had incorporated companies with the help of the infamous Mossack Fonsenca in Cayman Islands.

On the basis of investigation carried out so far, accused Avva Venkata Rama Rao, Avva Venkata Seshu Narayana Rao, Avva Hema Sundara Vara Prasad have been arrested for their involvement in committing offense of Money Laundering. The probe agency will be seeking Enforcement Custody of the accused for their custodial interrogation.

ED has initiated investigation based on multiple FIRs lodged in the States of Andhra Pradesh, Telangana and Karnataka which revealed that the multi crore scam was conceived by Avva Venkata Rama Rao through Agri Gold Group of Companies.

According to ED officials, accused AV Rama Rao hatched a well planned conspiracy and along with his seven brothers and other associates setting up more than 150 companies and started collecting deposits from general public with a promise of providing developed plots or farm lands or withdrawal at a high rate of return on maturity or pre-term.

Thousands of commission agents were engaged to lure people with various schemes for hefty commission and managed to collect Rs 6380 crore from 32,02,628 such investor accounts and the In the end, the gullible investors neither got plots nor could recover their deposits.

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The modus operandi of the scheme of the Agri Gold Group Companies was that, they would lure the gullible public to join as depositors in their schemes and encourage them to pay the desired deposits either directly or through the agents under the pretext of real estate deal.

These companies did not mention either the actual market value of the land or its location or its boundaries or survey numbers or the permissions required to be obtained for the layouts from the concerned authorities and the said company did not obtain permission from RBI to collect such deposits. SEBI has also asked the company to stop taking further deposits and return the money to the depositors but the accused persons,instead of complying with the directions,opened new companies and started collecting deposits in the names of new companies on the pretext of real estate business with the help of an army of commission agents, thus, turning this into a ponzi scam.

Although the accused collected deposits from 32 lakh investors, they never developed lands sufficient to give plots to all the investors, the ED said, adding that further investigation in this multi crore scam is under progress.

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