Bhubaneswar, Feb 15 (Agency) The Director and Promoter of a Chit Fund company was arrested on Tuesday by the Economic Offence Wing (EOW) Bhubaneswar from Gwalior on the charges of cheating over Rs 10 crore from gullible depositors of Odisha. EOW sources here on Tuesday said Babu Singh Kushwaha, Director and Promoter of M/S Aurora Deal Multitade (OPC) Pvt Ltd, a chit fund company was arrested on February 13 last u/s 406, 420, 467, 468, 471, 120 B IPC r/w Sec 66 of IT,2000, SEC 4,5 6, of PCMCS (Banning ) Act 1978 and Sec 6 of OPID Act 2011. After arrest, he was produced before the JMFC Dasara, Gwalior and was brought to Bhubaneswar.
A case was registered following an enquiry conducted by EOW on a petition filed by Chandrakanta Das and others against M/S Aurora Deal Multitrade (OPC) Pvt Ltd and its director and promoter on January 31 last on the allegation of cheating and duping as many as 500 gullible depositors to the tune of more than Rs 10 crore promising them of a high return on their deposit in different schemes launched by the company. Investigation revealed that the company is registered with ROC Gwalior during May 2019 and the accused Babu Singh is its only Director. The company under various lucrative schemes promoted direct selling of various household articles, electronic goods with high returns having cashback offers.
The business model of the company is a simple pyramid structure, that works as a binary scheme in which the early entrants earn money and as the number of depositors/investors increases, the scheme collapses at a point of time. During the investigation, it was found that in 2019-20, the company was functioning in a rented building in Sahadevkhunta, Balasore. Babu Singh and other promoters and upper line members made wide propaganda in Odisha and motivated the newcomers/investors to join various business packages and collected huge deposits from the public.