Class 7 dropout cheats 20 lakh people of Rs 3,000 crore
More than 20,00,000 people nationwide have been cheated of staggering Rs 3,000 crore, claim Cyberabad Police who arrested the prime promoter of a money circulation racket about a fortnight ago. Earlier, estimates were of Rs 1,200 crore.
Radheshyam is a class 7 dropout - who targeted unemployed youth and homemakers, promising them part-time income - is the founder of Future Maker Life Care Global Marketing Private Limited.
Three years ago the company was brought up with sourced funds from gullible clients who were promised extraordinarily high returns.
"The company had cheated people by using banned binary pyramid business model for their multi-level marketing scheme to attract investors," explained Cyberabad Police Commissioner VC Sajjanar, adding, people often join such schemes believing that sale of a product by securing commission is not illegal.
"The marketing firm charged Rs 7,500 from everyone as joining fee for the scheme with the assurance that they would get a pair commission of Rs 500 for enrolling two new members besides credit of Rs 2,500 a month for two years. In this manner, those cheated were promised of Rs 60,000 in two years on an investment of Rs 7,500," said Sajjanar who has laid bare infirmities and illegalities in several multi-level marketing entities in the past.
The police chief has written to the Reserve Bank of India and asked how commercial banks did not raise questions, and allowed such unscrupulous financial schemes to function without inquiring as to how they deposited huge sums.
After raising large sums in the northern states, Radheshyam and his accomplices had launched their operations in Hyderabad about three months ago.
The scandal surfaced when a prospective investor, a private company employee, at Kukatpally in the city, complained that he found the claim about rich returns suspicious after he had proposed to invest based on an advertisement.
Following their probe, the Cyberabad Police arrested Radheshyam and his worker Surender Singh in Haryana. They had become friends while working for a marketing firm and decided to start their own business.
Police have recovered Rs 60 lakh, a gun with 10 bullets, three luxury cars after raiding Radheshyam's home, office and godown in Hissar.