The Economic Offences Wing (EOW) has arrested a man for allegedly committing financial fraud in a chit fund scam in Baleswar district. The accused is identified as Nilesh Kar, the Baleswar head of a fake chit fund company which was cheating lakhs of people in India through an online ponzi scam in the name of crypto mining.
He was reportedly luring investors to invest money in the company through a digital app that would guarantee much higher and quick returns. He was arrested from Angargadia Bikasnagar in Baleswar on Thursday after a fraud complaint was filed against him by one Mahamanya Jena of Sahadebkhunta with the Cyber police and Crime Branch.
Jena alleged in his complaint that the accused asked him to invest in an app/website named ‘Cloud-Fut’ for earning extra money. Jena invested Rs 2.13 lakh between January and March this year. When he was to get Rs 50,57,117 on his invested amount (as shown in the Cloud-Fut wallet), the website suddenly stopped functioning and he could not withdraw the amount.
Preliminary investigation revealed that ‘Cloud-Fut’ is an app/linked based company running a huge ponzi/MLM scheme fraudulently claiming to be a crypto mining company. It claimed to be a US-based company headed by some Richard Purcell and had set up its office near Fakir Mohan Chowk in Baleswar a few months back. The firm’s Baleswar head Nilesh Kar then started reaching out to potential investors and asked them to invest their money through a digital app and assured them of quick wealth generation within a short span of time. A video was also shown to investors where a person claiming to be Richard Purcell was seen promoting ‘Cloud-Fut’ in English with an American accent. It claimed and also produced fake certificates of RBI to gain investors’ trust and claimed that the Government of India had made a 10-year agreement with the company.
For new members, huge bonus was offered and policies started as low as from Rs 665 to lakhs. As per reports, more than 80,000 investors across the country were lured into the trap out of which at least 200 are from Baeswar district. While initially they got some returns, some of them sensed foul play when at the end the website/app, mainly running through Telegram channel and WhatsApp groups, shut down. Subsequently, a complaint with Cyber police and Crime Branch was lodged.
Official sources said the accused was the certified district head of the company. He had shown a fake authorisation letter from RBI and also a fake appointment letter of Cloud-Fut as district head to gain trust of investors.
He was produced in a court in Baleswar and would be brought to Bhubaneswar on four days’ police remand. A case has been registered under Sections 420, 467, 468, 471 and 120 (B) of IPC, Section 66 (D) of the IT Act and Section 6 of the Odisha Protection of Interests of Depositors (OPID) Act. The extent of the fraud has not been ascertained yet and investigation is ongoing to find out mastermind of the scam, it was informed.